Shell warns chemicals and products business will post a fourth-quarter loss

Shell said its chemicals and products business will record a fourth-quarter loss after significantly lower oil trading results and an expected drop in chemicals margins; the company kept its oil, gas and LNG output forecasts within prior guidance.

Shell reported that its chemicals and products unit is set to record a loss in the fourth quarter, citing significantly lower oil trading results and a tax adjustment. The company also flagged an expected drop in chemicals margins. Shell maintained its previous guidance for oil, gas and liquefied natural gas production and for LNG liquefaction volumes. Key facts: - Shell said lower oil trading results were a primary factor in the expected quarterly loss for its chemicals and products segment. - Chemicals margins are expected to fall to about $140 per metric ton from $160 in the prior quarter, and a tax adjustment will also affect the segment. - The company kept upstream and integrated gas production forecasts within earlier guidance and expects LNG liquefaction volumes broadly in line with prior ranges. - Shares fell modestly after the update and the article notes several analysts lowered fourth-quarter earnings and operating cash flow estimates and reassessed buyback expectations. Summary: The update points to a softer quarter for Shell's chemicals and products business while core production guidance was left unchanged. Analysts reacted by lowering short-term earnings and cash-flow estimates. Undetermined at this time.