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Shell profits jump 95%
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August 3, 2000: 6:45 a.m. ET
Results boosted by higher oil prices; says cost cutting ahead of schedule
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LONDON (CNNfn) - Royal Dutch/Shell Group reported a 95 percent jump in second-quarter earnings Thursday, powered by higher gas prices, improved refining margins and cost-saving measures.
The world's second-biggest oil company earned $3.15 billion during the period, up from $1.61 billion in the 1999 second quarter. The results, which exceeded analysts' expectations, excluded one-time items.
Earnings benefited from surging gas and oil prices this year. But the company warned that such a pricing environment is not likely to continue for the long term.
"Don't be blinded by this period of high oil prices, I cannot see it as sustainable," said Chairman Mark Moody-Stuart. "In the longer term prices are bound to come down again and that is no bad thing too, because many customers are suffering from the high energy costs."
Shell said crude oil prices were likely to remain above $20 per barrel for the rest of the year.
 The company also said it was ahead of schedule to meet its cost-cutting target of $4 billion annually by 2001. Shell said it already has cut costs by almost $3 billion a year.
"What is sustainable is the success in improving our business. We have delivered almost three-quarters of the targeted $4 billion cost improvements in half the time," Moody-Stuart said.
For the first half of the year, profit excluding one-time items jumped to $6.28 billion, from $3.05 billion in the first half of 1999.
Shares of Shell [LSE: SHEL], which have outperformed the oil and gas sector by about 7 percent so far this year, were little changed in Thursday trading in London. The stock was up 1 at 548 pence by late morning.
In Amsterdam, Royal Dutch edged up 0.80 euros at 65.40 euros.
Exxon Mobil Corp., the world's largest oil company, last week reported that its second-quarter profit more than doubled. The third of the big three oil producers, BP Amoco PLC, is expected to release quarterly results next week. 
-- from staff and wire reports
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Royal Dutch/Shell
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