Shell vows to boost investor returns amid plans to cut costs and spending

Shell has revealed plans to ramp up cost savings and cut spending as it vowed to “deliver more value with less emissions” despite having last year weakened its carbon reduction pledge.

The oil giant told investors ahead of its capital market day event that it would now look to strip out a cumulative five billion US dollars to seven billion US dollars (£3.9 billion to £5.4 billion) a year by the end of 2028.

This is up from the previous aim for two billion dollars to three billion dollars (£1.5 billion to £2.3 billion) by the end of 2025.

It will also lower its spending to 20 billion dollars to 22 billion dollars (£15.5 billion to £17 billion) a year over the next three years.

The FTSE 100 firm told shareholders it would look to boost investor returns through share buybacks and dividends payouts.

It added it would seek to grow sales of liquefied natural gas (LNG) by 4% to 5% a year through to 2030.

In its plan, the firm said it would spend 10% of its budget on lower carbon businesses by the end of the decade, having last year significantly watered down its climate pledges.

It cautioned over plans to shut some chemicals operations across Europe, saying it wants to “unlock more value from our strong portfolio of chemicals assets by exploring strategic and partnership opportunities in the US and both high-grading and selective closures in Europe”.

Chief executive Wael Sawan said: “Today we are raising the bar across our key financial targets, investing where we have competitive strengths and delivering more for our shareholders.”

Last year Shell controversially dropped a plan to reduce net carbon intensity by 45% by 2035 and instead said it would aims for a 100% reduction by 2050.

It also revealed plans to reduce the “net carbon intensity” of the energy it sells by 15% to 20% by 2030 compared with 2016, having previously targeted a 20% reduction.