Shell has recorded a profit of $6bn (£4.65bn) in the third quarter, exceeding forecasts by 12%.

In its Q3 trading statement, the oil and gas giant said its sales of liquified natural gas (LNG) offset a drop in oil refining in this period.

The firm revealed that global refining margins fell in recent months, with a 70% drop in annual refining division, with its LNG recording a 13% increase in profits.

Year-on-year, Shell’s revenue dropped slightly by 8% in the nine months to September, reaching $218bn (£99.2bn).

However, its net debt fell by $3.1bn (£2.4bn) quarter-on-quarter, now standing at $35.2bn (£27.2bn).

Reuters reported that following this announcement, shares at Shell increased by 1.1% in early trading.

It comes as the oil and gas firm announced a $3.5bn (£2.71bn) share buyback, which it expects to complete by the Q4 results report.

Head of equity research at Hargreaves Lansdown, Derren Nathan, noted that the results are "impressive", while also giving confidence to shareholders and the board.

He stated: "Shell’s delivered a significant third-quarter beat driven by better-than-expected results in all division bar renewables. That’s given management the confidence to push the button on a $3.5bn (£2.71bn) buyback, marking the twelfth consecutive quarter where plans to repurchase $3bn (£2.33bn) or more have been announced. That’s impressive stuff in the context of weak commodity prices and industry-wide pressures on refining margins.

"At the same time, Shell’s still managing to shrink its net debt pile, paving the way for further shareholder distributions. With capital expenditure now set to come in below guidance for 2024, investors will be paying close attention to Shell’s capital allocation plans for 2025 when full-year results are announced."

Investment director at AJ Bell, Russ Mould, added: "Shell has managed to beat some gloomy forecasts in the third quarter despite the weak oil price. The addition of a new share buyback has helped drive a positive response from the market.

"The company’s long-term strategy of focusing on natural gas appears to be paying off with the integrated gas division proving the real engine of growth.

"The focus under CEO Wael Sawan has been on streamlining and simplifying the business and taking a more hard-nosed approach to the energy transition. While the aspiration of keeping up with US peers is still to be met, Shell has at least outperformed its direct UK rival BP."

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