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The Anglo-Dutch oil major said it would reduce capital expenditure to $20 billion or below from a planned level of about $25
The cuts are expected to boost Shell’s cash generation by between $8 billion and $9 billion on a pretax basis.
Shell’s shares were down 3.5% in early London trading, against 3%
Oil prices have crashed by more than 60% since January, hit by
Shell Chief Executive Ben van Beurden in January said that the company requires $20 billion of its capital spending to sustain operations at current output levels, with additional spending dedicated to growing its business, including $2 billion to $3 billion for building up its power and low-carbon energy business.
All of Shell’s business segments are reviewing spending to achieve the targeted cuts, a company spokeswoman said.
“The combination of steeply falling oil demand and rapidly increasing supply may be unique, but Shell has weathered
Even before the
Shell has so far purchased $15.5 billion of shares since the buyback program started in July 2018, it said.
“We will continue to review the dynamically evolving business environment and are prepared to take further strategic decisions and consider changes to the overall financial framework as necessary,” the company said.