Shell strengthens carbon commitment as results miss expectations

Royal Dutch Shell has strengthened a commitment to cut carbon emissions from its operations as it reported lower than expected earnings for the third quarter despite surging prices for fossil fuels.

Adjusted net profit from July to September fell to $4.1bn, from $5.5bn in the previous quarter, the energy company said, even as cash flow from operations, excluding working capital movements, hit $17.5bn, the highest ever.

The record cash flow was driven by Shell’s integrated gas business and “boosted by commodity derivatives”, it said.

Shell said it would reduce absolute emissions from its operations, known as scope 1 and scope 2, by 50 per cent by 2030 compared with 2016 levels.

The stronger climate commitment comes after a Dutch court in May ordered it to cut all emissions, including those released when its products are burned by customers, by 45 per cent by 2030.

Shell is under growing pressure on several fronts. The activist hedge fund Third Point, which has built a large stake in the company, has urged Shell to split into “multiple standalone companies” to deliver better value for shareholders through the energy transition.

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