The decline in refining margins and oil prices has led to a drop in profits for French company TotalEnergies and British company Shell in the third quarter, although their earnings still amount to several billion euros.
TotalEnergies reported a net profit of €2.1 billion for the third quarter on Thursday. This figure represents a 65% fall from the third quarter of 2023 and a 39% decrease compared to the second quarter.
British oil and gas giant Shell also saw a significant drop in third-quarter profit, earning $4.3 billion compared to $7 billion during the same period last year.
Both companies cited the decline in refining margins and oil prices as reasons for their reduced earnings.
"In a bearish oil environment, with sharply evolving refining margins, TotalEnergies is demonstrating the resilience of its integrated multi-energy model," said CEO Patrick Pouyanné, as quoted in the earnings statement.
TotalEnergies' adjusted net income for the third quarter stood at $4.1 billion, slightly below the $4.3 billion expected by FactSet and Bloomberg consensus. The company's net income for the first nine months of the year fell by 28% to $11.8 billion year-on-year.
Meanwhile, Shell's challenges this quarter were partly offset by lower operating costs and increased gas volumes.
TotalEnergies has decided to distribute a third interim dividend for the 2024 financial year, amounting to €0.79 per share, an increase of nearly 7% compared to 2023. Additionally, the group's board has authorised $2 billion in share buybacks in the fourth quarter of 2024, aiming to reach $8 billion for the year, Patrick Pouyanné added.
Last week, the French company was the target of multiple demonstrations in Belgium from the climate activists from Code Rouge. They protested against the climate impact of the industry and accused TotalEnergies of having a role in the violation of human rights.
