Oil giant Royal Dutch Shell beat forecasts today with a 36 per cent rise in second-quarter profits as high oil prices compensated for disappointing production news.
Investors were also cheered by Shell's reaffirmation that it was sticking to its 2006 and 2007 spending plans, despite rampant sector cost inflation.
Shell shares rose 2.24 per cent to trade at 1,914 pence in London at 8.30am, ahead of a 1.1 per cent rise in the DJ Stoxx European oil and gas sector index.
Lower-than-expected production of oil and gas and a reduction in the Anglo-Dutch company's 2006 output target took some shine off the results.
Shell said its second-quarter current cost of supply net profit, which strips out changes in inventory values, rose 36 per cent rise to $6.3 billion.
Excluding non-operational gains and losses, including a $500 million charge for litigation related to Shell's overstatement of its reserves, the result was $6.546 billion.
This was a record underlying profit and beat an average forecast of $6.149 billion from a Reuters poll of 12 analysts.
Shell's production of oil and gas disappointed slightly, however, falling almost 8 per cent to average 3.253 million barrels of oil equivalent per day in the second quarter, compared with an average forecast of 3.315 million boepd.