HOUSTON (Reuters) – Financial details of Shell’s vast oil and gas trading business are some of the company’s closest-held secrets. Documents in a lawsuit from a former employee showed its U.S. crude trading earns about $1 billion annually.
A former Shell executive’s testimony in a Texas court revealed lucrative profits and hefty bonuses in Shell’s U.S. crude trading division. The disclosures provide insight into Shell’s robust trading operations.
John Dimech, who was a manager in Shell’s crude oil trading group in Houston for 11 years, said in a deposition last year that the crude trading unit typically made between $950 million to $1 billion a year.
That is between 13% and 15% of Shell’s overall U.S. pre-tax profits in recent years, according to calculations based on company filings.
Shell’s 2022 tax contribution report revealed a pre-tax profit exceeding $7 billion in the U.S. The previous year’s pretax profit amounted to approximately $6.36 billion.
A Shell spokesperson declined to comment.
Traders make money by buying and selling oil and gas using gaps in supply and demand around the world to lock in profits. Their pay often includes promises of large bonuses based on their performance, that can be more than CEO Wael Sawan’s annual bonus, which was 2.7 million pounds ($3.4 million) last year, according to the latest annual report.
In the Houston court filing, Shell refuted a breach of contract claim from former trading manager Eva-Maria Frohn. She requested $15 million, including a $6 million bonus for 2021, having received over $5 million in 2020.
With a keen focus on market dynamics and emerging trends, Shell has consistently outperformed its competitors in Shell crude trading.
Moreover, the filing underscores Shell’s commitment to transparency and compliance in its trading activities, further solidifying its reputation.
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