A view shows a logo of Shell petrol station in South East London, Britain, February 2, 2023. REUTERS/May James/File Photo Purchase Licensing RightsShell's (SHEL.L), opens new tab refining profit margins dropped by nearly 30% in the third quarter from the previous three months as global demand sagged, while oil product trading earnings also weakened, it said on Monday.
A drop in refining margins in recent months, a result of slowing global economic activity and new refineries coming on line, is set to weigh on third quarter earnings of the world's top energy companies.
In a trading update ahead of its quarterly results on Oct. 31, Shell said its indicative refining margins dropped to $5.5 a barrel in the three months to the end of September from $7.7 a barrel in the previous period.
Trading results for its chemicals and oil products division were expected to be lower than in the second quarter, Shell said.
Shell processed around 1.4 million barrels per day of crude oil in its refineries in the second quarter, roughly 1.2% of global oil demand.
Shell, the world's largest trader of liquefied natural gas, also lifted its LNG production guidance for the quarter to a range of 7.3 million to 7.7 million metric tons from a previous forecast of 6.8 million to 7.4 million tons.
LNG trading results were set to be in line with the previous quarter.
Last week, Exxon Mobil (XOM.N), opens new tab warned that a slump in oil prices was set to hit its third-quarter results.
