The corporate juggling act between dividends and investment looks harder by the day
Was that confidence or complacency gushing out of Shell in the face of falling oil prices and a big miss in fourth-quarter profits? A $15bn (£10bn) cut in spending on new projects over three years sounds enormous until you remember how big Shell is. The reduction is 14%, which seems modest.
The case for the defence, of course, is that you can’t run an oil and gas exploration and production titan on a stop-start basis. If you don’t invest when the oil price is $50 a barrel you risk missing the financial prizes that come when $100 is back again. Fair point.
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