Cheaper oil hits Royal Dutch Shell and Exxon Mobil profits
Lower oil prices have hit quarterly profits at both Royal Dutch Shell and Exxon Mobil, but the results were not as bad as expected.
Underlying first-quarter profits at Shell fell 56% from a year earlier to $3.2bn (£2.1bn), but analysts had expected profits of about $2.5bn.
Exxon Mobil reported a first-quarter profit of $4.9bn, down from $9.1bn last year, but this also beat forecasts.
Both firms saw improved profits at their refining businesses.
All oil companies have been affected by the sharp fall in the price of oil over the past year.
After peaking at about $115 a barrel in the summer of 2014, the price more than halved, although it has recovered slightly since the beginning of the year.
Earlier in the week, UK oil giant BP also reported a fall in underlying profits. However, as with Shell and Exxon, the fall was less than had been feared, with BP's refining business also helping to bolster its results.
Shell's downstream business, which includes refining, saw profits rise 68% from a year earlier to $2.65bn.
However, profits at the upstream business, which includes exploration and production, dived 88% to $657m.
Announcing Shell's first-quarter results, chief executive Ben van Beurden said: "Our results reflect the strength of our integrated business activities, against a backdrop of lower oil prices.
"In what is clearly a difficult industry environment, we continue to take steps to further improve competitive performance by redoubling our efforts to drive a sharper focus on the bottom line in Shell."
Shell said it had sold $2bn of assets so far this year. Including the proceeds of asset sales, Shell's first-quarter profits rose 7% to $4.76bn.
Earlier this month, Shell announced it had agreed to buy oil and gas exploration firm BG Group in a £47bn deal.
If approved, the deal would be one of the biggest of 2015 and create a company valued at more than £200bn.
The better-than-expected results pushed shares in Shell up by about 0.4% to 2059.5p.
Keith Bowman, equity analyst at Hargreaves Lansdown Stockbrokers, said: "Like rivals including BP, the fall in the oil price has proved to be something of a double-edged sword, with the earnings-impacted upstream operations being partly compensated for by the tailwind given to its downstream refining business.
"The group's integrated business model is again aiding performance, whilst management is taking clear action, including the launch of a takeover for BG Group, in order to boost prospects."
Revenues at Exxon Mobil dropped 36% from a year earlier to $67.6bn, even though production volumes were up by 2.3%.
Profits at Exxon's upstream division dropped 63.3% to $2.9bn. However, profits at the refining arm more than doubled to $1.7bn.
"Exxon Mobil's balanced portfolio delivered solid financial results in the quarter," said chief executive Rex W Tillerson.
"Regardless of current market conditions, we remain focused on business fundamentals and competitive advantages."
Last month, Exxon announced that it expected capital spending to reach $34bn in 2015, a 12% fall from last year.