The post-tax impairments of between $4 billion and $5 billion in the first quarter will not impact the company’s earnings, Shell said in an update ahead of its earnings announcement on May 5.

Shell, whose market capitalisation is around $210 billion, had previously said the Russia writedowns would reach around $3.4 billion.

The increase was due to additional potential impacts around contracts, writedowns of receivables, and credit losses in Russia, a Shell spokesperson said.

The start of 2022 marked one of the most turbulent periods in decades for the oil and gas industry.

In the wake of Russia’s invasion of Ukraine, Shell has said it will exit all its Russian operations, including a major liquefied natural gas plant in the Sakhalin peninsula in the eastern flank of the country.

Benchmark oil prices soared to an average of more than $100 a barrel in the quarter, their highest since 2014, while European gas prices hit a record high.

Shell, the world’s largest liquefied natural gas trader, said earnings from LNG trading were expected to be higher in the quarter compared with the previous three months. Earnings from oil trading are set to be “significantly higher” in the quarter.

Cashflow in the quarter would be negatively impacted by “very significant” outflows of around $7 billion as a result of changes in the value of oil and gas inventories.

Shell’s fuel sales averaged 4.3 million barrels per day in the quarter, down from 4.45 million bpd in the previous quarter, Shell said.

LNG liquefaction volumes were slightly higher on the quarter, averaging 8 million tonnes, it added.