BUSINESS: Dutch/Shell Makes Third Reserve Cut This Year

Royal Dutch/Shell has cut their petroleum reserve estimates for the third time this year. This cut brings the total estimated reserve reduction to 4.35 billion barrels. Along with the reserve cuts, Judy Boynton, Shell's finance director, stepped aside in the third senior officer cut this year.

Washington Times
LONDON, April 19 (UPI) -- Royal Dutch/Shell said Monday in London it was restating the firm's oil reserves for the third time this year, the Times of London reported.
The latest restatement means the company has sliced 4.35 billion barrels of oil from its original 2002 estimate, with a further 500 million barrels of oil downgraded for 2003.

22% of Shell's estimated reserves have been slashed off. They never existed. The shareholders won't suffer too much of a shock; however, since the company was in the middle of a buyback that it is halting. These events could cause the SEC to look into the petroleum industry as a whole. How accurate are the reserve estimates from the other publicly traded oil companies?

In another major loss for the company, Standard & Poor has dropped their AAA rating of Shell to a AA+, which could slip as far as AA-. AAA is the highest rating for a corporation, and once a company falls from this rating it most likely will never get it back.

Additional Sources:
Bloomberg.com

Related ATS Discussions:
Shell Oil Implodes


[Edited on 19-4-2004 by dbates]

Ive been contemplating investing my money into a hybrid vehicle...while the price isnt as friendly, now seems a better time than ever, with avg gas prices in my area reaching nearly $2.00 a gallon. How I long for the days when .99 a gallon was *extreme* high. Where is the oil we are fighting so hard to procure?

Originally posted by illuminatus destructus
Ive been contemplating investing my money into a hybrid vehicle...while the price isnt as friendly, now seems a better time than ever, with avg gas prices in my area reaching nearly $2.00 a gallon. How I long for the days when .99 a gallon was *extreme* high. Where is the oil we are fighting so hard to procure?

The best route to take is gas/electric vehicle. Some of them even look normal now.
The biggest issue in the U.S. is that we spend our time getting cars that get 35 mpg up to 60 mpg. This doesn't address all of the vehicles that get < 20 mpg. But, no one wants to give up their SUV.