Shell profits soar

ROYAL Dutch Shell outshone its troubled rival BP today as it revealed a near-doubling in annual profits to £11.5bn.

Higher oil prices and a boost to production levels meant the Anglo-Dutch firm increased earnings in the final three months of the year by almost 400 per cent to 3.5bn.

The figures come two days after BP revealed its first annual loss in nearly two decades of 3bn after counting the cost of the Deepwater Horizon explosion.

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Despite the jump in headline profits, Shell's trading performance for the fourth quarter was well below forecasts in the City, causing its shares to open more than three per cent lower.

Stripping out one-off items, fourth quarter earnings of 2.5bn contrasted with the market's anticipated result of around 2.9bn.

Analysts said the company's downstream division, which covers the refining of crude oil and the sale of products, produced a weaker-than-expected recovery from the poor performance the previous year.

Shell said refining margins remained weak and its marketing business suffered as a result of pressure caused by rising oil prices.