Shell's Q1 performance "encouraging", says RBC

"Over recent years, Shell has had a number of stellar quarters; however, in between these there have been a number of operational issues that have hampered performance," RBC said in a research note on Friday.

"1Q results were evidence on what the business could look like if it was firing on most cylinders, and the result is higher CFFO [cash flow from operations] and FCF [free cash flow] than its US counterparts."

Shell reported adjusted earnings of $7.7bn, up fro $7.3bn in the fourth quarter and some 20% ahead of consensus estimates, along with stronger-than-expected cash generation. However, RBC said investors should focus on operational data points which were "encouraging".

"In particular, LNG liquefaction volumes came in at the top end of guidance, while downstream availability was also strong. A key focus of the new management team has been to sweat the asset base harder, and it does appear there is evidence of operational momentum. How long will it last? Time will tell."

RBC has a 3,000 target price on the stock, which was trading broadly flat at 2,871p by 1150 BST.