ROYAL Dutch Shell has reported a fall in third-quarter profits, citing lower oil prices and slowing global growth as contributing factors.

The oil giant said current cost of supply earnings, a proxy for net profit, dropped 15 per cent in the third quarter compared to last year.

It hit $4.76 billion, well below forecasts that had put the figure at $6.47bn, according to Neil Wilson, the chief market analyst at Markets.com.

The results come just days after London-listed rival BP warned that the oil price had reduced its profits by 40% over the quarter.

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The chief executive of Shell admitted that a major plan to return money to investors could be facing delays as challenging conditions dented the business.

The oil major shocked investors on Thursday morning as bosses said a weak oil price had torn through the business.

Chief executive Ben van Beurden said Shell will push ahead with a plan to return $25bn to investors by buying back shares, and will reduce gearing, the relationship between the company’s equity and how much it has borrowed.

He warned that “prevailing weak macroeconomic conditions and challenging outlook inevitably create uncertainty about the pace of reducing gearing to 25% and completing the share buyback programme within the 2020 timeframe”.

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David Barclay, head of office at Brewin Dolphin Aberdeen, said: “Royal Dutch Shell’s results are a reflection of its peer’s, BP, earlier in the week. The City was expecting income to have fallen on the back of lower oil prices in Q2 and, following Shell’s decision to enhance its disclosure to investors, there aren’t many surprises in these results.

“Improved cashflow and the next tranche of its share buyback programme are undoubtedly the bright spots in a tough quarter for the company.”

Oil majors were buoyed in September when drones attacked oil refineries in Saudi Arabia, knocking out 5% of global production.

The price of Brent crude, the international standard, jumped as much as 20% on the news of the attacks.

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Saudi Arabia quickly got production back up and running in the weeks after the attack, returning prices to pre-attack levels.

Fiona Cincotta, City Index analyst, said: “Tensions in the Persian Gulf briefly counteracted the effect of slowing global demand but overall Brent crude spent the better part of the quarter at below $60.”

Sven Reinke, a senior vice president, and lead analyst for Shell, at Moody’s said: “Shell’s results, although down compared to Q3 2018, were better than expected reiterating the company’s progress in recent years to cut costs and focus on profitability over volume growth.

“Shell hinting at a possibly slower pace for completing its $25bn share buyback program is credit positive.”

Shell was able to charge an average of $55.99 per barrel of oil it produced in the quarter, down from $68.21 in the same three months last year.

It was more than $1 lower than the second quarter price.

This combined with slightly lower production, at 3.56 million barrels of oil equivalent a day, to give the oil firm a bloody nose.

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Mr van Beurden said: “This quarter we continued to deliver strong cash flow and earnings, despite sustained lower oil and gas prices, and chemicals margins.

“Our earnings reflect the resilience of our market-facing businesses and their ability to capitalise on market conditions, including very strong trading and optimisation results this quarter.”

The head of Royal Dutch Shell’s UK business said earlier the oil giant is set to approve more developments in the North Sea amid calls from activists for curbs on activity to help tackle climate change.

UK country chair Sinead Lynch said Shell is looking at projects across the North Sea and the firm also said it is confident it can generate good returns in the area while supporting the effort to reduce carbon emissions.

Shares fell 3.3% to 2,251.5p on the news.