Russia's invasion of Ukraine has sent energy prices soaring and boosted profits for energy companies.
Shell posted record profits on Thursday (28 July) for a second straight quarter as the energy giant benefited from soaring oil and natural gas prices fueled by Russia's war in Ukraine.
London-based Shell said its second-quarter adjusted earnings — which exclude one-time items and fluctuations in the value of inventories — rose to $11.5 billion (€11.3 billion) from $5.5 billion (€5.4 billion) in the same three-month period last year.
The latest earnings smash its record set in the previous quarter, when the company recorded $9.1 billion (€9 billion) in adjusted earnings.
Shell also said it would buy back another $6 billion (€5.9 billion) in shares, underlining its healthy cash position.
How has Russia's invasion of Ukraine affected energy company profits?
Russia's invasion of Ukraine has sent oil and natural gas prices soaring as nations spurned Russian energy and supply reductions wreaked havoc in markets. The price increases are driving global inflation while boosting profits at energy companies.
"It was a turbulent quarter for the world and the global economy," Shell CEO Ben van Beurden said in a statement.
"The war in Ukraine continued, destroying lives and disrupting supplies of food and energy, and aggravating the lives of so many more through high energy prices and the cost-of-living crisis."
A windfall tax on energy company profits
The British government in May announced plans for a temporary 25 per cent tax on the windfall profits of oil and gas companies to help fund payments for people facing soaring energy bills. But its future is unclear after Prime Minister Boris Johnson resigned this month and a fight emerged over who will succeed him.
Spain has already introduced a windfall tax, using it to fund initiatives that will help tackle the cost of living crisis. This includes making short and medium distance trains free between September and December this year.
Natural gas prices in Europe jumped this week and were more than five times higher than a year ago. The increase comes as Russia further cut gas flows to Germany and European Union governments moved to reduce natural gas consumption this winter.