Weaker refining, gas trading to hit Shell’s Q3 results

Shell (LON:RDSa) said on Thursday its third-quarter profit would be pressured by a near halving of oil refining margins, crumbling chemical margins and weaker natural gas trading.

The British energy giant reported two consecutive quarters of record profit in the first half of the year amid soaring oil and gas prices, and stellar earnings from its trading operations, the world’s biggest.

Its shares were down 4.3% by 0847 GMT, compared with a 1% decline for the broader European energy sector.

But in the third quarter, indicative refining margins dropped to $15 a barrel compared with $28 a barrel in the previous three months, Shell said in an update ahead of its results on Oct. 27, amid growing concerns over a global economic slowdown.

And indicative margins for chemicals dropped to negative $27 per tonne versus a positive $86 in the second quarter after global demand for plastics slumped.

The drop in refining margins will have a negative impact of between $1 billion and $1.4 billion on the segment’s adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), Shell said.

ROYAL DUTCH SHELL Technical Analysis: Daily Chart

In the daily charts, ROYAL DUTCH SHELL is trading in an up channel. ROYAL DUTCH SHELL is currently trading above all SMA.

RSI is in buying zone which indicates bullishness. MACD is currently above zero which indicates bullishness.

Its immediate support is 22.54 & the resistance level is at 23.35.

ROYAL DUTCH SHELL will trade in an up channel until there is trend reversal.   

How to Trade ROYAL DUTCH SHELL this Week:

ROYAL DUTCH SHELL will follow the up channel until there is trend reversal. So, remain bullish on ROYAL DUTCH SHELL.

TRADE SUGGESTION- BUY AT 22.83, TAKE PROFIT AT 23.35 AND STOP LOSS AT 22.54