Shell hit hard as Q2 profits drop by 70%
CEO Peter Voser blames recession & oil price as profits drop to $2.3bn
Shell is the latest hydrocarbons giant to announce a huge second quarter drop in profits as both the drop in price and demand for oil batters the big oil producers.
The Anglo-Dutch supermajor posted profits of US$2.3 billion for the second quarter of 2009 compared to $7.9 billion for the corresponding period of 2008.
The new CEO of Shell, Peter Voser, blamed the drop on the economic downturn and the drop in oil prices from the vertigo inducing highs of $147 enjoyed by the industry a year ago.
“Energy demand is weak. There is excess capacity in the market, and industry costs remain high,” Voser said.
“Conditions are likely to remain challenging for some time, and we are not banking on a quick recovery.”
“Shell is adapting to this new situation, and we must do more. We are sharpening our focus on delivery and affordability.”
ArabianOilandGas.com reported earlier in the week that Voser is to oversee a huge streamlining initiative at the company in order to bring it into line with competitors like the market leader ExxonMobil.
A major cull of between 500-600 senior managers at the Anglo-Dutch company will be followed by more job cuts across the group.