SHELL has said it will reverse between $3.5 billion and $4.5 billion of previously announced writedowns in response to the bullish outlook for oil and gas prices. The UK supermajor said in an update ahead of its second-quarter results due on 28 July it is now assuming Brent crude prices of $80 per barrel next year and $70 per barrel in 2024 and 2025, with a longer-term assumption of $65 per barrel. This is up from previous assumptions of $60 per barrel for next year, 2024 and 2025, and $65 per barrel in the longer term. "In the second quarter of 2022, Shell has revised its mid and long-term oil and gas commodity prices reflecting the current mac-roeconomic environment as well as updated energy market demand and supply fundamentals," the company said. Shell has booked billions of dollars in impairments starting in 2020 as the pandemic choked global economic activity and demand for oil and gas, then Russia's invasion of Ukraine prompted a retreat from assets such as the Sakhalin 2 project in Russia's far east.
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