The two largest energy corporations in Europe, Shell, and TotalEnergies, both posted third-quarter earnings of more than $9 billion, despite Shell's LNG division's struggles to benefit from high fuel prices. Shell and TotalEnergies reported a significant increase in net profit in the third quarter, September 2022, compared to the previous quarters in 2022 and 2021.
The European Union and Britain were likely to increase their calls for additional windfall taxes on energy corporations to help families pay their gas and electricity bills because of the record earnings. As Moscow gradually reduced natural gas supplies via pipeline to Europe, largely dependent on Russian imports, LNG prices have skyrocketed this year.
European gas prices reached an all-time high in August because of Western sanctions imposed on Russia, one of the world's largest oil and gas producers, because of its invasion of Ukraine in February. Prices are still higher than they were a year ago, even though they have significantly decreased recently as Europe has filled its gas reserves and the weather has been unusually warm.
Due to a decrease in output because of strikes at Australia's Prelude plant, Shell, the largest LNG trader in the world, lost out on some of the price increase's benefits. Additionally, it stated that "significant disparities between paper and physical realizations in a turbulent and disrupted market" had a negative impact on its trading. Its integrated gas unit's headline earnings decreased nearly 40% from the prior quarter.
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