In key news on UK stocks, Shell (GB:SHEL) expects lower LNG (liquefied natural gas) trading results in the first quarter of Fiscal 2024 despite an improved gas production forecast. As per the latest update, the company anticipates its integrated gas production to be in the range of 960 to 1,000 kboe/d (thousand barrels of oil equivalent per day), up from its previous guidance of 930-990 kboe/d.
Additionally, the company expects its LNG volumes to be between 7.2 million and 7.6 million metric tons in Q124, a slight increase from 7.1 million tons in the preceding quarter. However, the trading results for the LNG segment are expected to be much lower than the previous quarter. Shell shares were up by 0.11% during opening hours on Friday as of writing.
Shell is a leading oil and gas company, providing a wide range of energy products, including fuels, oil, liquefied petroleum gas (LPG), lubricants, etc.
Let’s take a look at more details from the update.
Key Points from Shell’s Quarterly Update
In the Upstream sector, Shell projects a more constrained production range of 1,820 to 1,920 kboe/d, compared to 1,870 kboe/d reported in Q4 2023. Exploration well write-offs for Q1’24 are anticipated to total around $0.6 billion, primarily attributed to activities in Albania.
Meanwhile, Shell predicts that losses in its Chemicals sub-segment will decrease compared to Q4’23. The segment has faced significant challenges amid sluggish global demand. Profit margins for Chemicals are projected to increase to $151 per ton from $125 per ton in the previous quarter.
Lastly, Shell is cautious about the Renewables and Energy Solutions segment and anticipates its bottom line in the range of a loss of $100 million to a gain of $500 million.
Shell will publish its first-quarter results for Fiscal 2024 on May 2.
Is Shell Stock a Good Buy Now?
According to TipRanks consensus, analysts have rated SHEL stock as a Strong Buy. This is based on 10 Buy and two Hold recommendations. The Shell share price target of 3,196.04p implies a 15.4% increase on the current price level.
