Shell saw profit from its lubricants unit fall in the fourth quarter, cutting total profit for the year to the lowest in more than six years.Profit fell last year even as the lube unit’s revenue extended its rise to the highest in more than six years.Rising sales and squeezed profit mirrored a pattern among many major lubricant blenders as they struggled to fully pass on rising costs of everything from feedstock supplies to freight and packaging.Some lube blenders cushioned the squeeze on profit margins by benefitting from strong growth in other segments of their business such as specialty oils. Others were units of companies with other major products.Lube blenders without alternative revenue streams faced more difficulty managing the squeeze on profitability.Shell is the world’s largest lubricants supplier. At the same time its lube unit’s profit accounted for less than 1pc of Shell’s total profit in the fourth quarter of last year.The lube unit’s adjusted earnings of $79mn in the last three months of 2022 fell from $103mn during the third quarter and by 61pc from year-earlier levels..The fall in earnings for the sixth time in seven quarters cut the unit’s total profit to $745mn in 2022. Profit fell by 26pc from $1.01bn the previous year and from $1.30bn in 2020.The fall in fourth-quarter profit contrasted with a 6pc rise in the unit’s sales.But the pace of the rise in sales slowed from more than 14pc in each of the previous seven quarters. The slowdown in revenue growth coincided with a 9pc dip in the lube unit’s total sales volume to 74,000 b/d (987,000t).The sales volume was the lowest since the second quarter of 2020, when widespread lockdowns throughout the world slashed economic and industrial activity.The lower sales volume in the fourth quarter of last year partly reflected a seasonal drop in lube consumption ahead of and during winter.Slowing global economic growth compounded the drop in lubricants consumption and squeezed blenders’ leverage to raise prices. .Apar’s Q4 lube profit extends fall
Shell saw profit from its lubricants unit fall in the fourth quarter, cutting total profit for the year to the lowest in more than six years.Profit fell last year even as the lube unit’s revenue extended its rise to the highest in more than six years.Rising sales and squeezed profit mirrored a pattern among many major lubricant blenders as they struggled to fully pass on rising costs of everything from feedstock supplies to freight and packaging.Some lube blenders cushioned the squeeze on profit margins by benefitting from strong growth in other segments of their business such as specialty oils. Others were units of companies with other major products.Lube blenders without alternative revenue streams faced more difficulty managing the squeeze on profitability.Shell is the world’s largest lubricants supplier. At the same time its lube unit’s profit accounted for less than 1pc of Shell’s total profit in the fourth quarter of last year.The lube unit’s adjusted earnings of $79mn in the last three months of 2022 fell from $103mn during the third quarter and by 61pc from year-earlier levels..The fall in earnings for the sixth time in seven quarters cut the unit’s total profit to $745mn in 2022. Profit fell by 26pc from $1.01bn the previous year and from $1.30bn in 2020.The fall in fourth-quarter profit contrasted with a 6pc rise in the unit’s sales.But the pace of the rise in sales slowed from more than 14pc in each of the previous seven quarters. The slowdown in revenue growth coincided with a 9pc dip in the lube unit’s total sales volume to 74,000 b/d (987,000t).The sales volume was the lowest since the second quarter of 2020, when widespread lockdowns throughout the world slashed economic and industrial activity.The lower sales volume in the fourth quarter of last year partly reflected a seasonal drop in lube consumption ahead of and during winter.Slowing global economic growth compounded the drop in lubricants consumption and squeezed blenders’ leverage to raise prices. .Apar’s Q4 lube profit extends fall
