Glencore interims rise $10bn, to return $4.5bn to shareholders

The company on Thursday said group adjusted core earnings rose 119% to $18.9bn, but said it expected more normal marketing conditions to prevail in the second half of the year. Coal, which Glencore has stuck with as most other miners seek to exit fossil fuels, generated earnings of $8.9bn.

Shareholders will get $4.5bn of "top-up" returns, made up of a $1.45bn special distribution and a new $3bn buyback program.

"Global macroeconomic and geopolitical events during the half created extraordinary energy market dislocation, volatility, risk, and supply disruption, resulting in record pricing for many coal and gas benchmarks and physical premia,” Glencore said.

"Looking ahead, tightening financial conditions and a deteriorating macroeconomic environment present some uncertainty for commodity markets through the second half of the year.”

However, Glencore said that with few short-term solutions to rebalance global energy markets, coal and LNG prices look set to remain elevated “particularly given the current challenge of securing sufficient and reliable energy supply for the Northern hemisphere winter ahead”.

"For metals, the outlook is more complex, balancing supply risks, amid labour, water and energy shortages, supply chain disruptions, growing sovereign risk uncertainty and rising costs, against likely weakening end-use markets ex-China.”

“There are some recent signs of China recovering from its Q2 trough, which could help to offset potentially weaker conditions in other key consuming markets.”

Reporting by Frank Prenesti at Sharecast.com