Oil major Shell issues massive profit warning

- Q4 earnings 'significantly lower' than recent levels- Profits miss market forecasts by a wide margin- Full-year earnings well below last yearOil major Royal Dutch Shell has warned that fourth-quarter profits will be 'significantly lower' than recent levels as the company had to deal with tough market conditions in downstream, higher exploration expenses and lower upstream volumes.Fourth-quarter earnings on a current cost of supplies (CCS) basis are expected to be just $2.9bn, down from $4.5bn in the third quarter and $7.3bn in the fourth quarter the year before. Market expectations were for a profit of around $4bn.This even excludes the impact of so-called "identified items" relating to a $0.7bn impairment charge in the Upstream division. Including these identified items, fourth-quarter earnings are expected to total just $2.2bn.Nevertheless, even without this impact the company said that Upstream earnings were hit by higher exploration expenses and lower volumes in the fourth quarter, as well as the weakening of the Australian dollar.Full-year CCS earnings for 2013 excluding identified items are expected to come in at around $19.5bn, reflecting lower results in each of Upstream, Downstream and Corporate compared with the previous year.This compares with a profit of $27bn earned in 2012 and the $28.6bn made in 2011."Our 2013 performance was not what I expect from Shell," said Chief Executive Ben van Beauden."Our focus will be on improving Shell's financial results, achieving better capital efficiency and on continuing to strengthen our operational performance and project delivery."The company will release its fourth-quarter and full-year results on January 30th.BC