Shell’s profit from its lubricating oil unit extended its rebound in the fourth quarter of the year amid lower costs and steadier sales.

The world's largest finished lubricants supplier saw its lube unit’s adjusted earnings more than double to $193mn in the three months to end-December, up from $71mn during the same period a year earlier.

The rise in earnings every quarter of the year lifted total profit to $1.06bn in 2023, up 47pc from $716mn in 2022.

The lube unit’s earnings extended its rebound in the fourth quarter as a 4pc drop in costs outpaced a less-than 1pc fall in sales.

Lower costs coincided with a slump in prices of key raw materials like Group III base oils.

US Group III 4cst base oils prices averaged around $1,670/t during the final three months of 2023, down 20pc from $2,100/t during the same period a year earlier, ICIS data showed.

The lube unit’s revenue got support from a rise in sales volume to 78,000 b/d (1.01mn t) in the fourth quarter, up from 74,000 b/d during the same period a year earlier.

The higher sales volumes coincided with signs of ongoing pressure on lube demand in the US in the fourth quarter.

But demand showed signs of bottoming out or edging up in other regions like Latin America, Europe and Asia.