Royal Dutch Shell and BP faced calls yesterday to invest more in North Sea production after reporting combined profits of more than £7bn during the past three months, as the price of oil and gas soared to record levels.

BP beat forecasts with a 48% leap in first-quarter profit to $6.6bn (£3.3bn), while Shell, the world's number two non-government-controlled oil company by market capitalisation, said earnings rose 12% to a record $7.8bn. Shell's figures came out only a few days after the company announced it will cut at least 180 jobs in Aberdeen by the end of the decade.

BP, the world's third-biggest non-state-controlled oil firm, said its operations in the North Sea reported a large increase in profitability - up 27% to $923m - because of the high price of oil.

Both companies benefited from crude oil prices that are at a record high near $120 a barrel. Crude futures shed $3.12 yesterday to $115.63 a barrel after workers ended a strike at the Grangemouth refinery.

"We had a very good quarter from trading operations," said BP spokesman David Nicholas. "The contribution was something like $400m above what you would generally see."

Jeroen van der Veer, Shell chief executive, said: "Good operating performance, combined with increased oil and gas prices, offset the impact of downstream conditions in the first quarter."

The oil majors' core oil and gas production units were the main providers of the bumper profits, thanks to oil prices which averaged almost $100 a barrel during the quarter, and strong gas prices in the US and Europe.

Overall, oil and gas production was flat at both companies. Analysts had expected a drop at Shell.

Refining profits held up better than expected despite high crude prices putting pressure on margins, and retail earnings rose as the companies found it easier than anticipated to pass high prices on to motorists.

Evolution Securities ana- lyst Richard Griffith said the high profits showed that operational improvements, which BP chief executive Tony Hayward made his priority when he took the reins a year ago, are well advanced.

Hayward, who took office last May, quickly began a $1bn restructuring programme, admitting that the business suffered from operational deficiencies.

Its US refinery business was a particular concern, following the Texas City explosion of 2005 in which 15 people died.

Hargreaves Lansdown analyst Keith Bowman said BP had posted "an exceptional set of numbers". He added: "Although this should not come as a complete surprise, given historically high energy prices, management have been battling against a series of operational difficulties and the results may indicate that challenges are being won."

Shell and BP's results prompted a call from Prime Minister Gordon Brown for the hefty profits to be reinvested in recovering more oil from the North Sea.

Speaking on GMTV, Brown said: "We do need the oil coming out of the North Sea, we do need to encourage the new exploration. That is more expensive to do. That is why I hope that these profits are going to be invested in getting more oil out of the North Sea."

Graham Tran, regional officer of the Unite union, said: "These profits are a slap in the face for 180 staff at Shell (in Aberdeen) who were told less than seven days ago that they face redundancy."

A Shell spokesman said the company wanted to revamp its activities in Scotland and a proportion of global work would be carried out in Aberdeen.