Shell profits slump 80pc in oil turmoil

THE sustained attack on the fortunes of the oil majors continued with Royal Dutch Shell revealing its biggest loss in 13 years.

The oil price rout left annual profits at Shell down 80pc at £2.6bn for 2015, compared with £13bn the previous year.

The Anglo-Dutch group, which is due on February 15 to seal its £ 35bn takeover of gas giant BG Group, has already culled 7,500 jobs and will cut another 2,800 as it tries to maintain its dividend.

It revealed another £7bn of selloffs this year and has already highlighted £20.6bn of assets that it will begin to sell in the coming months.

Shell chief executive, Ben van Beurden, said: ‘We are pulling very powerful financial l evers… to respond to the lower oil price.’

Shell’s update follows BP’s on Tuesday which revealed its biggest ever loss of £4.5bn.

Fears remain that the big oil companies will be forced to cut their desirable dividends. However, Shell confirmed a dividend payout of $0.47 (32p) a share in the first quarter of 2016 – unchanged from the level paid out in previous quarters – but has not made a commitment beyond this year.

The major US oil firms have also witnessed huge earnings falls but not all share the view of Shell and BP on dividends. ConocoPhilips cut its quarterly dividend by 66pc.

The results did not frighten off investors – Shell’s share price closed up 6.1pc or 87.5p to 1525.5p. BG will post full-year earnings today.

On Tuesday, BP boss Bob Dudley predicted the oil price will rise to between $50 and $60 a barrel by the end of the year. At present it is below $35 a barrel, having fallen from $115 in June 2014. BG’s shares closed up 4pc, or 41p, to 1057p.