Shell Plc boosted its share buyback to $5 billion for the fourth quarter, up from $3 billion, returning more of a wartime refining windfall to investors as disruptions across the Middle East and Russia squeeze global fuel supplies. The London-based major's adjusted net income reached $10.8 billion, above analyst expectations, driven by a record refining margin of $42 a barrel during the quarter.
Many of Europe's biggest oil companies are channeling booming refining profits back to shareholders rather than chasing growth. Total Energies SE pledged up to $2.5 billion of repurchases for the fourth quarter, Spain's Repsol SA started a program of up to 950 million euros, and Italy's Eni SpA announced an increased buyback last week.
The payouts are fueled by an extraordinary squeeze on global refining capacity, with wars involving Iran and Russia knocking out or disrupting refineries and trade routes. Shell's shares rose as much as 3.6% in London, leading the sector higher. The company said its refineries will run at between 92% and 100% of capacity in the final three months of this year.
Shell's buyback puts it on par with sector-leader Exxon Mobil Holdings Corp., which plans $20 billion of repurchases this year. The US company reports earnings tomorrow, as do BP Plc and Chevron Corp.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing