Royal Dutch Shell outshone its troubled rival BP today as it revealed a near-doubling in annual profits to $18.6 billion (£11.5 billion sterling).
Higher oil prices and a boost to production levels meant the Anglo-Dutch firm increased earnings in the final three months of the year by almost 400% to $5.7 billion.
The figures come two days after BP revealed its first annual loss in nearly two decades of $4.9 billion after counting the cost of the Deepwater Horizon explosion in the Gulf of Mexico.
Despite the jump in headline profits, Shell's trading performance for the fourth quarter was well below forecasts in the City, causing its shares to open more than 3% lower.
Stripping out one-off items, fourth quarter earnings of $4.1 billion contrasted with the market's anticipated result of around $4.7 billion.
Analysts said the company's downstream division, which covers the refining of crude oil and the sale of products, produced a weaker than expected recovery from the poor performance the previous year.
Shell said refining margins remained weak and its marketing business suffered as a result of pressure caused by rising oil prices.
The company has responded to the difficult conditions in downstream through a restructuring and by refocusing its efforts on emerging growth markets.
In contrast to BP, which stopped paying dividends in the wake of the Gulf of Mexico disaster, Shell said it declared dividends of $10.2 billion in 2010. The payout underlines the sudden switch in momentum between the firm and its rival, triggered by the Gulf catastrophe.
The jump in Shell's profits reflected asset disposals and its strong upstream performance due to higher oil prices and a 5% rise in production to just under 3.5 million barrels of oil equivalent in the fourth quarter.
'We are making good progress against our targets, and there is more to come from Shell,' said chief executive Peter Voser.
