Change of the guard: Shell appoints new head of trading
Royal Dutch Shell has appointed Andrew Smith to run its large-scale trading operations, putting a new face at the top of one of the world’s most powerful oil and gas dealers.
Mr Smith, who runs Shell’s Australia business, will replace Mike Conway as trading head from May, Shell said in a statement, while Zoe Yujnovich, from Shell’s oil sands business in Calgary will replace Smith.
Mr Conway’s retirement comes after more than a decade at the top of Shell’s trading business, which he helped build into one of the biggest energy traders in the world, using not just Shell’s own oil but also third parties’.
His departure will mark a major changing of the guard at the top of the trading businesses of the world’s biggest oil companies.
Mr Conway’s retirement comes three months after BP announced its long-time trading chief, Paul Reed, was stepping down after 37 years with the company.
Shell, BP and France’s Total are some of the world’s largest oil traders, shifting millions of barrels of crude and oil products every day. They seek to both maximize the value of their own production and refining systems while also competing with independent rivals like
Vitol, Glencore and Trafigura.
Trading has become a more important part of oil majors’ operations during the price slump of the last three years, helping bolster profits against declining revenues from production.
As the oil glut swamped the market traders with access to shipping and storage – and backed by big balance sheets – were able to buy up millions of barrels of cheap crude to wait until prices recovered.
The profits churned by trading divisions during the oil slump did not go unnoticed. ExxonMobil, which has in the past eschewed trading, last year started investigating setting up a full-scale trading unit to compete with its European rivals.
Trading conditions appear to be getting tougher, however, as oil prices stabilise above $50 a barrel. Shell said on Thursday that trading profits in 2016 were not as strong as the previous year, which is expected to be largely reflected across rivals in the industry.