The oil price rout last year led to a cataclysmic decline in profits for Shell, one of the world’s largest oil and gas companies.
Full-year earnings collapsed from $19 billion in 2014 to just $3.8 billion in 2015, according to figures released on Thursday.
The price of oil has collapsed to around $35 a barrel from a high of over $110 a barrel in June 2014 as OPEC nations flood the market with cheap oil in a bid to drown out US shale suppliers.
The collapse in oil prices has hit producers hard, with BP announcing a 51% collapsing in profits earlier this week. BP announced plans to cut 7,000 jobs as part of a cost-cutting drive and Shell has already earmarked 10,000 jobs to go.
But Shell is bullish on its prospects for the year ahead with CEO Ben van Beurden saying in Thursday’s statement:
The completion of the BG transaction, which we are expecting in a matter of weeks, marks the start of a new chapter in Shell, rejuvenating the company, and improving shareholder returns.
We are making substantial changes in the company, reorganising our Upstream, and reducing costs and capital investment, as we refocus Shell, and respond to lower oil prices. As we have previously indicated, this will include a reduction of some 10,000 staff and direct contractor positions in 2015-16 across both companies.
Shell is paying £47 billion to merge with oil explorer BG Group. The deal was first announced last April.
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