Shell profits drop 80 percent due to to oil price collapse

The profit forecast for the AngloDutch oil company Royal Dutch Shell was 1,659 million dollars (1,494 million euro) in the first semester 2016, representing an 80 percent drop.

The company said that its revenue for the first semester was 106,969 million dollars (96,272 million euro), a 22.5 percent drop over the same period last year, in a statement published Thursday.

The gas business had been good but the “low oil prices remain an important challenge” and required costcutting measures to deal with the situation”, Shell CEO Ben van Beurden said.

Shell’s profits were affected by the oil price drop in Q2 of 2016, averaging a global benchmark price of 46 dollars per barrel compared to the 62 dollars per barrel during the same period last year.

Purchases during the first semester totaled 73,648 million dollars (66,356 million euros), a 26.2 percent decrease yearonyear.

The oil company also announced a dividend of 0.47 dollars (0.42 euros) per ordinary share for this year’s Q2 (April to June).

Shell completed its BG Group oil company acquisition earlier in 2016 and applied a 35 percent costcutting plan.

The group foresees savings of 4,500 million dollars (4,054 million euros) after the BG merger, and expects to complete a divestment of assets valued at 30 billion dollars (27 billion euro) within the next two years. EFE