According to Royal Dutch Shell CEO Peter Voser, the Dutch company almost doubled its earnings from higher oil prices and chemicals margins. Its profits would have been even higher – a concept almost impossible to wrap one’s mind around – if not for weak refining margins, pressure on certain regional natural gas prices, and volatility in downstream marketing margins as a result of rising oil prices.
That last statement is most telling because it reflects the price that we pay for gas at the pumps. Yes, we loving gearheads – and those who use our cars for basic transportation, too – resist paying $4 a gallon for gas. That immeasurably hurts Shell’s ability to make even more money.
Here are some other facts from the Shell annual earnings statement:
- Full year 2010 cash flow from operating activities was $33.3 billion compared to $23.8 billion in 2009.
- Basic current cost of supplies earnings per share increased by 90 percent versus a year ago.
- A fourth quarter 2010 dividend has been announced of $0.42 per ordinary share, unchanged for the same period in 2009. The first quarter 2011 dividend is expected to be declared at $0.42 per share.
So, keep in mind as you fill up at the pump, Shell would love to charge you even more for a gallon of gas so it can more than double its earnings beyond $18.6 billion, but we consumers are just not willing to pony up more cash yet. Apparently resistance is not futile.