Shell Takes a Big Hit: 22 Billion Dollar Write‑Down
Oil powerhouse Royal Dutch Shell just announced it will write down the value of its assets by up to $22 bn. That’s a hefty price tag on a company that once kept the world running on gasoline. Why? Because oil prices are taking a nosedive, and Shell’s own forecasts predict a mat‑ting cup of coffee for the next few years.
What the Numbers Look Like
- Average long‑term refining margins down ≈30 %.
- Brent crude forecast:
- 2022: $35 per barrel
- 2023: $40 per barrel
- 2024: $60 per barrel (still a steep climb, but no match for the 2022 dip)
- Fuel sales expected to plunge 40 % this quarter—thanks to jet lag in the form of COVID‑related travel restrictions.
Why the Shake‑up?
After CEO Ben van Beurden announced in April a goal to cut greenhouse‑gas emissions to net zero by 2050, Shell is doing a massive operations audit. The company’s latest move is part of a broader strategy to align with what investors and climate activists have been shouting about for years.
Green‑Giant‑Glooms: A Soundbite from Greenpeace
Mel Evans, senior oil campaigner for Greenpeace UK, said:
No one wants oil on the shelves in 2050. Shell is finally realizing that the climate emergency is slashing oil’s value. It’s time for Ben to switch gears—now’s the moment to pivot to renewables, because our planet’s future depends on it.
The Takeaway
Shell’s ego has suffered a brutal lesson: as oil prices keep sliding, the company’s once massive asset base shrinks. The company’s next move will determine whether it thrives in a cleaner world or gets left behind. The clock’s ticking, and the future is aiming for less gas and more green.
