Shell bounces back to beat expectations

Royal Dutch Shell said its profits jumped in the third quarter after it benefited from higher oil prices and a 5 per cent rise in production.

The group posted profits of $3.5bn (2.2bn) for the three months to September 30, an increase of 18 per cent on a year earlier, although this was down on the second quarter haul of $4.5bn.

The figure, which exceeded City forecasts, also reflected progress on Shell's $3.5bn cost-saving plan, which has seen 7,000 jobs go.

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Chief executive Peter Voser said: "Our results have rebounded substantially from year-ago levels, driven by some improvement in industry conditions, and Shell's strategy. We are making good progress against our targets, and there is more to come from Shell."

Profits were helped by higher oil and gas prices than in 2009, when much of the global economy was still in recession.

Upstream exploration and production profits more than doubled on a year ago to $3.1bn (2bn), but refining earnings were sharply lower amid difficult industry conditions.

In contrast to BP, which has stopped paying dividends in the wake of the Gulf of Mexico disaster, Shell said it paid $2.6bn (1.6bn) to its shareholders.