Shell benefits from higher oil prices

Oil giant Shell has reported an increase in quarterly profits boosted by soaring oil costs.

The company reported profits of $7.9 billion (£4.0 billion) in the April to June period, an increase of 4.6% compared with the same period of 2007.

The figures were boosted by earnings from the company’s oil sands business in North America, which increased their earnings by more than 70% over the last quarter.

Commenting on the figures, Jeroen van der Veer, chief executive of Royal Dutch Shell, said operating performance, together with increased oil and gas prices, offset the impact of weaker downstream conditions.

The good performance follows strong results from fellow oil company BP, who earlier this week posted a 23% increase in half-yearly profits, also boosted by soaring oil costs.

The announcement from BP caused outrage amongst unions and motorists who have accused BP and Shell of cashing in on rising energy prices and are calling for a windfall tax on their profits to help those struggling to deal with higher energy costs.

Shell did not disclose how much it had earned from British drivers at its network of petrol service stations but maintains that it is one of the cheapest suppliers.

Mr van der Veer warned that talk of windfall taxes against the energy companies would be unfair and counterproductive.

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