Shell’s renewable energy business lost $489m (£361m) last year after the majority of its green projects became loss-making.

The company said on Thursday it would refocus on oil and gas, as Wael Sawan, the chief executive, promised to reduce spending on poorly performing clean-energy projects.

Shell cut $5bn of costs last year, including by abandoning projects such as a biofuels refinery in Rotterdam and a string of wind farms across Britain and the US.

Mr Sawan said 2025 had been “a year of accelerated momentum” achieved by “better discipline”, meaning axing poorly performing projects. He said: “You see that reflected in tough choices like stopping construction of the biofuels plant in Rotterdam.”

The plant, designed to convert waste into jet fuel, was abandoned in mid 2024, but losses have continued into 2025. Losses at the refinery are now thought to exceed $1.4bn.

Despite cutting costs, Shell posted its worst quarterly profit in almost five years as the falling price of oil weighed on its performance. Brent Crude fell from a high of more than $78 a barrel last summer to as little as $56 in December.

Shares dropped by as much as 2.6pc on Thursday after Shell posted adjusted net income of $3.2bn for the final three months of 2025, 11pc lower than a year earlier and lower than average analyst estimates of $3.5bn.

While oil and gas were a weak spot at the end of last year, Mr Sawan is betting on fossil fuels for the future. New production is planned in the Gulf of Mexico and Brazil, while exploration is planned off Angola and South Africa.

“We are committed to bringing new oil and gas projects online that at their peak will add more than one million barrels of oil equivalent per day by 2030,” he said.

Shell’s focus has shifted dramatically under Mr Sawan. Six years ago, his predecessor, Ben van Beurden, revealed plans to make the company a net-zero-emissions business by 2050.

The Powering Progress plan included an ambition to cut oil production by 1pc to 2pc a year until 2030 and to shift investment into low-carbon energy, such as wind farms.

Mr Sawan has reversed those production aims, pledging that Shell will instead boost oil production by around 1pc to 2pc annually, while cutting out unprofitable renewables.

Last year, Shell pulled out of the ScotWind floating turbine project in the North Sea off Scotland, quit the Atlantic Shores wind farm planned off the coast of New Jersey and diluted Shell’s stake in Savion, a US-based subsidiary focused on solar developments.

Shell said on Thursday that “most” of its renewable projects were loss-making in the fourth quarter of 2025.

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