Royal Dutch Shell: Risks in Transnational Markets



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In a Volatile State

In January 2014, Ben van Beurden (van Beurden) took over as the Chief Executive Officer of Anglo Dutch Oil Major Royal Dutch Shell PLC (Shell) from Peter Voser (Voser). Immediately after assuming office, van Beurden announced that the company’s fourth quarter revenues in 2013 would be 48% lower than the earnings for the fourth quarter in 2012.

This was the company’s first profit warning in a decade. Shell announced its annual results a few weeks later. For the year 2013, the earnings were US$ 16.8 billion as against US$ 27.16 billion in 2012 . Capital expenditure during the year was US$ 46 billion, 15% higher than the initial projections. .....

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The company cited reasons like high exploration expenses, lower volumes, maintenance expenses, and low margins in Asia and Europe as the main reasons for its poor performance. Analysts said Shell had faced problems in several international markets and this had had an impact on its earnings. The company was adversely affected by its exploration in the US shale and in Alaska, and had also faced problems in developing markets like Nigeria. .....

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