At YourDailyAnalysis, we note a significant strategic reversal by one of the world’s leading energy giants. Shell has announced a $600 million write-down in the third quarter following the cancellation of its Rotterdam biofuels plant. The total impairments and provisions related to the project now reach $1.4 billion, marking a symbolic retreat from the company’s earlier “green transition” ambitions.
We at YourDailyAnalysis emphasize that the project-designed to produce 820,000 tons of biofuels per year-was originally approved in 2021, when Shell positioned itself as a leader in decarbonization. However, construction was paused last year and ultimately cancelled in September 2025. The company admitted that the project had become economically unviable, as rising costs and shrinking margins made biofuel production uncompetitive in today’s energy landscape.
This decision fits into a broader industry pattern: major oil and gas companies are retreating from earlier renewable energy commitments and redirecting capital toward more profitable traditional businesses. In February, BP announced a sharp cut in renewable investments, while Equinor said it would scale back its green energy ambitions. We believe Shell is following a similar pragmatic approach – prioritizing profitability and long-term stability amid global market uncertainty.
At the same time, Shell is showing stronger momentum in its liquefied natural gas (LNG) division. The company raised its third-quarter production forecast to 7-7.4 million tons, above earlier estimates. At YourDailyAnalysis, we view this as a deliberate shift toward sectors with steady demand and resilient margins, positioning LNG as a cornerstone of Shell’s post-transition strategy.
Shell also expects significant improvement in trading results within its integrated gas division, while its refining margin rose to $11.6 per barrel, up from $8.9 the previous quarter. Despite weak oil prices and softer gas trading that weighed on second-quarter profits, operational indicators point to stabilization and renewed efficiency.
However, not all areas of the business are equally strong. Shell’s chemicals division remains in the red, and the company continues to seek partners or buyers for some of its chemical assets. Additionally, a $200-400 million write-down is expected due to revised reserve data from Brazil’s Tupi fields – a standard industry adjustment, according to company representatives.
We at Your Daily Analysis believe that despite abandoning its high-profile “green” project, Shell is demonstrating strategic flexibility and financial discipline, reallocating resources toward profitable and strategically critical segments such as LNG and energy trading.
Our forecast: Shell’s move sends a clear signal to the entire energy sector. The era of “energy realism” is replacing the earlier wave of green optimism. In the coming years, energy companies will seek to balance environmental commitments with economic viability. In this new paradigm, Shell stands out not as a retreating player – but as a leader redefining what sustainable profitability means in the global energy market.
