Shares in oil giant Royal Dutch Shell lifted more than three per cent after the company revealed its first quarter profit more than doubled.
Europe's largest oil and gas firm reported net income attributable to shareholders increased 142 per cent to $3.75bn (£2.92bn), compared with a company-provided analysts' consensus of $3.05bn.
Cash flows from operating activities rose 1,338 per cent to $9.5bn, higher than analyst forecasts, enabling Shell to reduce debt and cover its cash dividend for the third consecutive quarter.
Shell's dividend remained flat from the previous year at $0.47 per share.
Upstream, or oil and gas production, lifted two per cent to 3.752m barrels of oil equivalent.
The firm's shares rose 3.07 per cent to 2,123.84p at the time of publishing.
Why it's interesting
Although oil prices have not risen as high as analysts hoped after the Organisation of the Petroleum Exporting Countries (Opec) and non-Opec producers agreed to cut production, Brent crude prices averaged around $54 per barrel in the first quarter of this year compared with just under $34 a barrel in the same period last year.
What Shell said
Chief executive Ben van Beurden said: "We saw notable improvements in upstream and chemicals, which benefited from improved operational performance and better market conditions. Our operations in Qatar are restarting during the second quarter.
"We continue to reshape Shell’s portfolio and to transform the company with over $20bn divestments completed or announced that will strengthen the balance sheet as they are completed.
The strategy we have outlined to deliver a world-class investment case is taking shape. Following the successful integration of BG, we are rapidly transforming Shell through the consistent and disciplined execution of our strategy. This includes investing around $25bn this year and the delivery of new projects, which we expect to generate $10bn in cash flow from operating activities by 2018.
What analysts said
Nicholas Hyett, equity analyst at Hargreaves Lansdown, said:
“It’s been some time since reading a set of oil results could be described as a pleasure, but today, Shell’s fit the bill. The improvement in upstream was to be expected given the oil price environment, and was actually slightly behind consensus, but the strong cash flow and lower debt are a pleasant surprise.
"Shell’s fortunes remain exposed to the oil price of course, and capital expenditure has been slashed. That can’t last forever, but today’s numbers suggest Shell is well on the way to recovery."