Shell's LNG Production and Trading Outlook Dims Amid Strategic Shift

Shell has lowered its LNG production forecast and expects reduced trading results in Q4. Facing impairments and a strategic shift, including stepping back from offshore wind, Shell's performance contrasts sharply with past profits. The energy sector sees an overall decline amid steady prices and faltering demand.

Shell has announced a trimmed forecast for its liquefied natural gas (LNG) production for the fourth quarter alongside an expected drop in oil and gas trading results. This adjustment precedes Shell's Jan. 30 announcement of its full-year results.

Ahead of these results, Shell disclosed impending non-cash, post-tax impairments worth $1.5 to $3 billion, including up to $1.2 billion in its renewables division. This move correlates with Shell's strategic reevaluation which saw the company pulling back from new offshore wind investments and restructuring its power division, aligning with CEO Wael Sawan’s focus on profitable ventures.

The decline is part of a broader trend among leading oil and gas companies experiencing reduced profits due to stable energy prices and weak global oil demand. Shell's LNG trading faced challenges as hedging contracts from 2022 expired, leading to subdued results for the quarter.

(With inputs from agencies.)