Shell's Q1 earnings drop but still beat expectations

First-quarter earnings on a current cost of supplies basis and stripping out one-off items fell 58% from the previous year to $1.55bn as weak oil prices continued to take their toll, but the results were still better than the $1bn pencilled in by analysts.

Meanwhile, net income fell to $484m from $939m in the first quarter of 2015.

Chief executive Ben van Beurden said: “We continue to reduce our spending levels, to capture cost opportunities and manage the financial framework in today’s lower oil price environment. The combination with BG is off to a strong start, as a result of detailed forward planning before the completion of the transaction.

“This will likely result in accelerated delivery of the synergies from the acquisition, and at a lower cost than we originally set out.”

Also on Wednesday, Shell announced plans to cut spending this year to $30bn from previous guidance of $33bn. This is around 36% lower than the combined Shell and BG investment in 2014.