Amidst soaring profits, oil giant Shell has come under fire for its dwindling investments in renewable energy, which plummeted to a mere 8% of the company’s overall spending in the latest quarter. The revelation has sparked outrage among climate activists who accuse the oil supermajor of jeopardizing its future by clinging to fossil fuels.
Shell’s Renewable Energy Spending Drops to 8% Despite $6B Profit
According to Shell’s Q3 financial results, the company spent a paltry $409 million on its renewables and energy solutions business out of a total capital expenditure of nearly $5 billion. This comes after Shell watered down its carbon emissions targets in March, drawing sharp criticism from environmental groups.
“Shell’s focus on fossil fuels jeopardizes the future of the company,” warned Mark van Baal, founder of the activist shareholder group Follow This. “By prioritizing short-term profits over long-term sustainability, Shell is putting itself at risk in a rapidly changing energy landscape.”
Oil Giant Posts Better-Than-Expected $6B Profit
Despite weaker oil prices, Shell managed to beat profit expectations, posting earnings of $6 billion for the quarter—higher than analysts’ predictions of $5.36 billion. The company attributed its strong performance to increased gas sales.
Shell also announced plans to buy back another $3.5 billion in shares from investors, marking the 12th consecutive quarter of buybacks exceeding $3 billion. In 2023, the company distributed a staggering $23 billion to shareholders, representing more than 42% of its operating cash flow.
CEO Claims Shell is Delivering “More Value With Less Emissions”
In a statement, Shell CEO Wael Sawan asserted that the company’s “strong results” demonstrated its commitment to delivering “more value with less emissions.” However, critics argue that Shell’s plans to grow its gas production in the coming years fly in the face of climate experts’ warnings that new oil and gas projects are incompatible with limiting global warming to 2°C above pre-industrial levels.
“Shell delivered another set of strong results,” Sawan said. “We continue to deliver more value with less emissions, while enhancing the resilience of our balance sheet.”
Job Cuts Loom as Shell Aims to Slash $3B in Costs
As part of a cost-cutting campaign spearheaded by Sawan, Shell is gearing up to slash up to $3 billion in expenses by the end of 2024, which includes cutting hundreds of jobs from its oil and gas exploration division. The job cuts are expected to hit the company’s offices in Houston and The Hague the hardest, with a lesser impact on its UK operations.
Climate Activists Slam Shell’s “Brazen Injustice”
Environmental groups have slammed Shell’s cost-cutting measures and lackluster investments in renewable energy as a “brazen injustice” in the face of the climate crisis. Greenpeace UK campaigner Aakash Naik highlighted the stark disconnect between Shell’s massive profits and the devastating impacts of climate change fueled by the burning of fossil fuels.
“In just the last three months, Shell banked over £4bn and are promising even more to shareholders in buybacks. In the same period, hurricanes and storms supercharged by the burning of fossil fuels have killed thousands, displaced millions and caused billions in damage around the world. The disconnect is startling.”
– Aakash Naik, Greenpeace UK
Calls for Bold Action at Upcoming Climate Talks
As international climate negotiations approach, activists are urging world leaders to take decisive steps to compel the fossil fuel industry to halt drilling and pay for the immense harm it has inflicted on people and the planet. The upcoming talks present a crucial opportunity to address the glaring injustice of oil companies reaping massive profits while the world grapples with the devastating consequences of climate change.
“It’s time for leaders to take bold action to force the industry to stop drilling and pay up for the immense harm it is doing to people and planet,” Naik asserted, underscoring the urgency of the situation.
As pressure mounts on oil giants like Shell to accelerate their transition to clean energy, the question remains: will they heed the call to action and prioritize the planet over profits, or will they continue to cling to the fossil fuel status quo at the expense of a livable future? The coming months and years will be critical in determining the trajectory of the energy industry and the fate of our global climate.
