Royal Dutch Shell announced that net profits rose 7% to USD 3.463 billion in the Q3 from one year ago driven by higher output, rising oil prices and lower costs. However the net profit figure, equivalent to EUR 2.503 billion also included a massive USD 1.442 billion of impairments and write downs on the value of assets.

Adjusted net profit, stripping out exceptional items and changes to the value of oil inventories rocketed 88.4% to USD 4.933 billion in the 3 months to September. That beat expectations for profit of 4.32 billion. Production rose 5% over the period to 3.058 million barrels of oil equivalent per day compared with the same part of last year.

Mr Peter Voser CEO of Shell said that our results have rebounded substantially from year ago levels, driven by some improvement in industry conditions and Shell’s strategy. We are seeing new growth, with improved earnings and cash flow underpinned by 5.0% increase in oil and gas production, 22% increase in LNG sales and increased downstream volumes. This is a better performance from Shell achieved despite continued difficult industry conditions in refining and natural gas markets.

Mr Peter Hutton oil sector analyst at NCB Stockbrokers in London said that in reaction to the results, Shell’s ‘A’ share price rallied 1.21% to 2,001 pence in morning deals on London’s FTSE 100 index of top shares which was 1.03% higher at 5,704.07 points. This is an excellent set of results and operational measures.

He added that the results were reflecting strong volume growth and cost improvements in the upstream and improved performance and recovery in the downstream it more than delivers on the expectation of momentum.