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Shell said its net profits jumped by a third to €7.409bn (us$11.55bn) in the second quarter owing to record high oil prices. Oil Products sales volumes in the second quarter 2008 increased by 2% compared to the same quarter last year.
Net earnings on a current cost of supply (CCS) basis, excluding fluctuations in the value of inventories, rose five percent to us$7.9bn in the three months to the end of June, compared with the same period of 2007. Shell added in a results statement that production fell by 1.6 percent during the reporting period to 3.126 million barrels of oil equivalent per day.
Second quarter Oil Products segment earnings were $4,539 million compared to $3,928 million for the same period last year.
Second quarter Oil Products CCS segment earnings were $1,075 million compared to $2,936 million in the second quarter 2007. Earnings included a gain of $181 million related to identified items, compared to a gain of $205 million in the second quarter 2007 (see page 3 for details). In addition second quarter 2008 marketing and trading earnings were reduced by a non-cash charge of around $450 million as a result of fair value accounting of commodity derivatives (See Note 8).
CCS earnings compared to the second quarter 2007 reflected substantially lower realised refining margins, higher operating costs, mainly as a result of exchange rate movements, and lower trading contributions.
Industry refining margins compared to the same quarter a year ago were lower in Europe, declined significantly in the US Gulf Coast and US West Coast and were higher in the Asia-Pacific region. Refinery availability remained at 92%, the same level as in the second quarter of 2007.
Marketing earnings compared to the same period a year ago declined due to higher operating costs and lower lubricants margins. In addition, retail margins, net of exchange rate movements, declined, which were partly offset by higher B2B margins.
Oil Products (marketing and trading) sales volumes increased by 2% compared to the same quarter last year. Marketing sales volumes were 1% lower than in the second quarter 2007 and excluding the impact of divestments were 2% higher mainly because of increased aviation, marine and commercial fuels sales.
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