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The company said on Saturday that it had managed to “considerably reduce” the leak from a pipe leading to the Gannet Alpha platform, located 112 miles east of Aberdeen in Scotland.

Shell did not say how much oil had been released since the leak was found on Wednesday, but estimated that the size of the sea surface affected was around 31 kms by 4.3 kms at its widest point.

The company added that it expects “the sheen to disperse naturally through wave action and not reach the shore”.

“Shell takes all spills seriously, regardless of size and we have responded promptly to this incident,” it said in a statement.

“Our current expectation is it will be naturally dispersed through wave action and will not reach shore.”

The suit was filed at London’s High Court less than two weeks ago on behalf of King Felix Sunday Berebon of Bodo and 18 other parties.

Shell and its joint venture with the Nigerian government, Shell Petroleum Development Company (SPDC), were already facing a class action on behalf of 69,000 people in Bodo over the spills in 2008.

In this first case, SPDC said it will take responsibility and pay compensation. It is currently in negotiations over a settlement and the claim against Shell, the parent company, has ceased.

However, the joint venture moved to quash early estimates that the case could cost it upwards of $210m (£128m) in compensation, saying this was “misguided and massively in excess of the true position”. Damages are likely to be in the tens of millions of dollars.

The second case, filed on behalf of King Felix Sunday Berebon, is understood to be at a much earlier stage of negotiation.

BP

HSBC suggests an accelerated “shrink to grow” strategy which could add 160p a share to the company’s value. JP Morgan Cazenove has said a full break-up would create $100bn of cash for investors. Clearly these City figures place far more reliance on Dudley’s ability to sell assets than growth them.

Today’s results continue to give that view credence.

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“Investors feel that the company has slightly lost its way,” Paul Mumford, fund manager at Cavendish Asset Management. “You need to have some clear guidance on where the company is going in the future, and how they are going to advance their strategy,” he added.

Some industry experts have suggested that BP should follow the example of ConocoPhillips, which last week spun off its oil-refining and fuel retail unit.

Meanwhile, BG Group, their smaller rival, is expected to have doubled its profits to $2bn for the past three months, compared with the previous year.

Analysts at Barclays Capital expect profits at the oil companies and refiners it follows will increase 42pc in the second quarter, fuelled by a 50pc jump in crude prices and global refining margins.

However, experts claim that the high oil price is masking serious operational challenges in the sector that may soon begin to show.

Despite the big figures and optimistic headlines, Deutsche Bank analysts say oil companies are going to have a tough time keeping up production.

Large oil companies have found it difficult to increase production. Investment in massive, long-term exploration projects is required and access to resources is tougher, with many producing nations restricting oil majors’ access.

“A key facet of a sector bull thesis is that, after a number of years of disappointment, 2012 to 2013 will see the sector return to growth,” a Deutsche Bank spokesman said. “Unfortunately, second quarter 2011 results are unlikely to build confidence in this theme.

“A combination of divestments, maintenance, extreme seasonality [low European gas demand], limited production from Libya and a series of stock-specific issues, drive our expectation for a 7pc year-on-year production decline.”

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Both oil companies measure their profits by stripping out changes in their inventories, describing them as “cost of supply” or “replacement cost” profits.

Meanwhile, BG Group, their smaller rival, is expected to have doubled its profits to $2bn for the past three months, compared with the previous year.

However, analysts claim that the high oil price is masking serious operational challenges in the sector that may soon begin to show.

Despite the optimistic headline numbers, Deutsche Bank analysts Lucas Herrmann, Mark Bloomfield and Elaine Dunphy argue that the oil companies are going to have a tough time maintaining production.

“A key facet of a sector bull thesis is that, after a number of years of disappointment, 2012 to 2013 will see the sector return to growth. Unfortunately, second quarter 2011 results are unlikely to build confidence in this theme,” they said.

“A combination of divestments, maintenance, extreme seasonality [low European gas demand], limited production from Libya and a series of stock-specific issues, drive our expectation for a 7pc year-on-year production decline.”

There may also be pressure among investors for oil companies to investigate breaking off their exploration and production divisions from refining and marketing, like ConocoPhillips has done this month.

BP would be considered the most likely candidate for such a break-up, since its sell-off programme following the Gulf of Mexico oil spill has whet investor appetite for asset sales at much higher prices than book value.

Bank of America Merrill Lynch estimates that BP’s market capitalisation still stands at a 50pc discount to the value of its assets.

Shareholders are going to want to know how BP’s chief executive, Bob Dudley, plans to boost the company’s fortunes, after the Gulf of Mexico oil spill and a failed £10bn deal in Russia with Rosneft. One top 20 investor in BP said: “Break-up is a radical strategy but one whose logic must be considered by the companies in terms of value creation.”

This time last year, BP was in the throes of its Gulf of Mexico crisis, following an explosion on April 20. Over the past year, its share price has risen 17pc, compared with Shell’s increase of 30pc. Taken from the worst of BP’s crisis, its price has increased 54pc to 470p per share, while Shell’s share price is up 45pc at £22.86.

Separately, Centrica will this Thursday release its first set of results since British Gas raised prices substantially this month.

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A spokesman for the North Caspian Operating Company (NCOC), which operates the project, said the consortium had not altered its plans to hit the 2013 target. “We are still working towards the target of the end of 2012 and a lot of effort is going into meeting that date,” he said.

When the Caspian field was found in 2000, it was the largest oil discovery in 30 years, with reserves of 9bn to 13bn barrels of oil.

But it has been dogged by technical difficulties, pushing total development costs as high as to $136bn. The delay will inevitably increase friction with Kazakhstan, complicating the group’s struggle to win approval for a second phase of the development.

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Carl-Henric Svanberg said BP is still optimistic about reaching a deal “in some form or another” after a planned share swap and exploration deal with the Kremlin-backed oil giant fell through.

Bob Dudley, the chief executive of BP, also implied that the company’s efforts to expand in Russia are not yet quite over.

“We’ve worked very hard on this with all the parties,” he said. “From BP’s view, it’s other parties that need to reach an agreement and in the meantime we are moving on.”

The alliance was frustrated because of an exclusivity agreement governing TNK-BP, the joint venture between BP and four oligarchs in Russia.

The four billionaires obtained a court order banning BP and Rosneft from exploring the Arctic together.

His comments come after the collapse of Rosneft’s £10bn share swap and Arctic exploration deal with BP, Shell’s nearest rival.

Mr Putin told the Russian state news agency: “We’ve been working with Shell for a long time. We’re comfortable with them.”

However, he showed that Russia is still keeping its options open by adding “our work with BP is not over yet”.

The BP-Rosneft alliance was frustrated when it emerged that an existing agreement between BP and four Russian billionaires prevents the British company from pursuing any other opportunities in the country.

Since then, Rosneft has been talking to other parties, such as Shell, Chevron and ExxonMobil.

A spokesman for Shell confirmed earlier this week that its chief executive, Peter Voser, had been in “constructive talks in Moscow this week regarding potential exploration co-operation with Rosneft in the Arctic, broader strategic co-operation and technology development for the Arctic and other areas as well as opportunities for Rosneft to join Shell in developments outside Russia.”

The right to look for oil in the Arctic is a great prize for foreign companies as there is the potential for major discoveries in an area the size of the North Sea.

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