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* Shell guides to lower oil sales products
* Maintains capex at lower end of $24-$29 bln range
* Writedowns follow several other oil majors
(Adds details, graphics, updates shares)
By Ron Bousso and Pushkala Aripaka
Dec 20 (Reuters) - Royal Dutch Shell said on Friday
it expected to write down up to $2.3 billion in the fourth
quarter, the latest major energy company forced to shrink
estimates for sector values due to a weaker economic outlook.
In a trading update ahead of full year results, Shell also
lowered its oil products sales forecast, pointing to the first
annual slowdown in sales since at least 2014, while maintaining
spending on the lower end of forecasts.
The Anglo-Dutch company warned in October that trade
tensions between the United States and China, the world's two
largest energy consumers, could hurt demand and take a toll on
its performance.
Shell said it expected to take post-tax impairment charges
in a range between $1.7 billion and $2.3 billion for the quarter
"based on the macro outlook". It did not say which assets the
impairments relate to.
Since October, rivals Chevron, BP, Equinor
and Spain's Repsol all wrote down a total of
around $20 billion, primarily in U.S. shale gas assets due to
lower long-term gas prices.
The impairment will likely increase Shell's debt ratio, or
gearing, which the company has struggled to reduce in recent
years.
"This reduction in guidance and impairment appears to show
that management underestimated how much weaker oil prices would
be in the latter part of this year, as well as underestimating
future demand for oil, along with its by-products," said Michael
Hewson, chief market Analyst at CMC Markets UK.
Its shares were down 1.1% by 1145 GMT, compared with slight
gains on the broader European energy index.
Shell, which had beaten third-quarter profit expectations on
strong oil and gas trading, also warned that higher taxes would
hit earnings by about $500 million to $600 million in the fourth
quarter.
The company said it expected additional well write-offs in
the range of $100 million to $200 million in the period, while
2019 capital expenditure was expected to be at the lower end of
its guidance range of $24 billion to $29 billion.
Shell gave guidance for oil product sales of 6.5 million to
7 million barrels per day (bpd) in the fourth quarter, compared
with its earlier estimate of 6.65 million bpd to 7.05 million
bpd. That would mark the first decline in sales since at least
2014.
Chemical sales were expected to reach 3.4 million to 3.6
million tonnes, marking a sharp slowdown in 2019 compared to the
previous five years.
Production of oil and gas is expected to be higher from the
third quarter, while liquefied natural gas (LNG) volumes are in
line with previous forecasts at between 8.8 million and 9.4
million tonnes.
Shell reports fourth quarter results on Jan. 30.
(Reporting by Pushkala Aripaka in Bengaluru; Editing by Emelia
Sithole-Matarise and Edmund Blair)
