Shell reviewing oil output reduction targets, CEO tells the Times

LONDON, March 3 (Reuters) - Shell (SHEL.L) is reviewing its current plan to reduce oil output by 1% to 2% per year by 2030, Chief Executive Officer Wael Sawan told the Times, against the backdrop of rival BP recently rowing back from hydrocarbon output reduction aims.

Sawan took office at the start of the year with a vow to boost Shell's performance and review its operations, while backing his predecessor Ben van Beurden's strategy to shift the company towards low-carbon energy.

The CEO nevertheless indicated that Shell could revise its current goal of reducing its oil output by 2030.

"We're reflecting on what is the right guidance to the market," Sawan told the Times in an article published on Friday.

Signage is seen at a Shell petrol station in London, Britain, May 5, 2022. REUTERS/Toby Melville

"I am of a firm view that the world will need oil and gas for a long time to come. As such, cutting oil and gas production is not healthy."

Shell expects its oil and gas output to reach between around 1.8 million and 2 million barrels of oil equivalent per day this quarter.

BP (BP.L) last month rowed back from plans to cut its oil and gas output by 40% by the end of the decade, and instead targeting a reduction of 25%. In contrast to BP, Shell never set a target for the reduction of its gas output.

Both Shell and BP reported record profits in 2022 on the back of soaring oil and gas prices following Russia's invasion of Ukraine.

Sawan, a Lebanese-Canadian citizen who joined Shell 25 years ago, has already announced plans to restructure the energy company's organisation and launched a review of Shell's European power retail businesses.

Reporting by Ron Bousso; Additional reporting by Shadia Nasralla; Editing by Shounak Dasgupta and Jan Harvey

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