Shell profits soar on high oil prices

"Our second quarter 2011 earnings were higher than year-ago levels, driven by increased energy prices and Shell's operating performances," Chief Executive Peter Voser said in a results statement.

Profits in the second-quarter of 2010 had stood at $4.4 billion, according to Shell, which is Europe's biggest oil company.

Adjusted net profits, stripping out gains in the value of Shell's energy inventories, jumped to almost $8.0 billion between April and June from $4.5 billion last time around.

Oil prices soared during the reporting period amid violent unrest in the crude-producing Middle East and North Africa region.

The Anglo-Dutch group added that production dropped in the quarter by 2.0 per cent to 3.0 million barrels of oil equivalent per day.

Voser said that the outlook for the rest of the year was positive.

"We have made important progress with new production in 2011, and the ramp-up of our new projects should drive our financial performance in the coming quarters," he said.

Shell's update comes two days after rival BP said it had bounced back into profit in the second quarter thanks to high oil prices and after a huge loss last year caused by costs linked to the Gulf of Mexico oil spill disaster.

"Without the distractions which have plagued arch rival BP, Shell has been able to capitalise on higher energy prices and the bottom line performance is stark confirmation of the gap between the two," said Richard Hunter, head of UK equities at Hargreaves Lansdown Stockbrokers.

"Shell is also looking further ahead, with a major investment programme over the next three years already underway in countries such as Canada and Qatar."

He added that potential blind spots relating to the group's prospects tended to be industry-wide "rather than Shell-specific, such as many governments looking to increase their tax take on oil companies and the shadow cast over the sector from the Gulf of Mexico spill."

Shell's shares closed 0.11 per cent up at 2,275 pence on London's benchmark FTSE 100 index, which finished 0.28 per cent higher at 5,873.21 points.

The oil sector was further boosted on Thursday after ExxonMobil, the world's largest energy firm, revealed that second-quarter profits rocketed 41 per cent to $10.68 billion amid surging prices for crude.

Revenues for the April-June period were $125.5 billion, up 36 per cent from the same period last year, ExxonMobil said. Analysts had expected revenues of $121.4 billion.