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The Scotsman: As prices sits near record highs, oil’s big two are set to sparkle

THE interim reporting season heats up this week when a raft of heavyweights from the banking, oil and pharmaceutical sectors are due to unveil figures.

BP and Royal Dutch Shell report first-half profits figures after facing different challenges in an eventful quarter for the oil majors.

The two firms report as the price of oil hovers around $78 a barrel – near last August’s record high.

Analysts’ consensus forecasts for Royal Dutch Shell are expecting the firm to post underlying earnings of $6.76 billion (£3.3bn) for the second quarter – 7 per cent higher than the $6.31bn reported last year.

The profits are expected to be higher despite continued security problems for Shell in Nigeria, where the company is losing around 180,000 barrels of oil a day in the Western Delta due to attacks from militants.

Meanwhile, BP prepares to post its first set of figures without Lord Browne, who was forced to resign in May after lying to a court over his relationship with former partner Jeff Chevalier.

But analysts expect new chief executive Tony Hayward’s inaugural results day tomorrow will see the company’s second quarter underlying profits fall to around $5.05bn, down from $6.12bn last time.

Production difficulties at its US refineries are behind the expected profits fall, according to Evolution Securities analyst Richard Griffiths.

But there has been some good news for BP over the period. In May the firm announced a return to Libya after more than 30 years under a £900 million exploration deal.

Is skullduggery in Nigeria pumping up global oil prices?

Your article comments on high oil prices and the related huge profits being generated by Shell and BP.

When the news media reports on rising high oil prices, militant attacks in Nigeria are often cited as a factor e.g. the following extract is from a report in The Scotsman, Friday 13 July 2007: “The attacks have contributed to a drop in production of about 25 per cent, driving up oil prices worldwide with no end to the kidnappings in sight”.

Shell is the leading oil producer in Nigeria. To the outside world it appears to be an unfortunate victim of regular attacks by militants on its employees, pipelines and installations which drive up the price of oil. As readers who check out the link below will see, the truth is more sinister and bizarre.

Posted by John Donovan of the website:

For the complete article by VICTORIA THOMSON go to… and its sister non-profit websites,,,,,, and are owned by John Donovan. There is also a Wikipedia feature.

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