Shell’s earnings comfortably beat market expectations last quarter, as higher volumes at its gas business helped offset a slump in profit margins at its refineries and lower oil prices.

The oil and gas giant said adjusted earnings were 6.03 billion US dollars (￡4.64 billion), down 3.1% from 6.22 billion dollars (￡4.79 billion) during the same period last year.

The figure beat a company-provided analyst consensus of 5.36 billion dollars (￡4.13 billion), and Shell confirmed plans for further returns to shareholders.

Total production at Shell’s integrated gas business was 941 thousands barrels of oil per day (boe/d), down on the last quarter but up 4.5% on the same period last year.

Meanwhile, liquefaction volumes – turning natural gas into liquid – was 7.5 million tonnes, up 9% on the same period last year.

Integrated gas has been a growing focus for chief executive Wael Sawan, who has carried out a cost-cutting programme at the company and reduced its focus on renewables since joining in 2023.

The results came after Labour confirmed plans to raise a windfall tax on North Sea oil and gas firms to 38% from 35% and extend the levy by a year, in its autumn Budget on Wednesday.

Commenting on the tax increase, Shell chief financial officer Sinead Gorman said: “Elected officials just have to balance budgets in the best way they see fit.

“We have to look for policies that provide certainty… We invest over the long term.

“We have seen a number of changes in the fiscal policy… in the last few years, but we continue to engage constructively with the Government on alternative fiscal regimes to support the future of the North Sea and that energy transition in the UK.”

Ms Gorman added that Shell still faced a “less favourable” macroeconomic environment more broadly.

Brent crude prices remain significantly down over the last six months, and weaker demand for oil worldwide has hit margins at Shell’s oil refineries.

Refining is “a bit more difficult at the moment. We’re definitely seeing a period of rebalancing in all the energy markets”, she said.