“The company is running well and it continues to strengthen. We have real strategic momentum,” BP’s chief executive Bernard Looney told Reuters.

Bernard Looney, who took office in 2020 with a vow to rapidly shift BP away from fossil fuels to renewables, said BP will increase its spending on new oil and gas by $500m in response to the global supply crunch.

“We will direct more investment towards hydrocarbons to help with energy security in the near term,” Looney said. “We’ll probably direct about a half a billion dollars for hydrocarbons.”

BP plans to maintain its overall capital expenditure this year in a range of $14 billion to $15 billion.

BP increased its dividend by 10% to 6.006 cents per share, more than its previous guidance of a 4% annual increase. It halved its dividend to 5.25 cents in July 2020 for the first time in a decade in the wake of the pandemic.

The company also increased its share repurchases plan for the current quarter to $3.5 billion after it bought $4.1 billion in the first half of the year.

The company said it expected crude oil and gas prices as well as refining margins to remain “elevated” in the third quarter and said it would stick to its target of using 60% of its surplus cash on share buybacks.

The surge in revenue also allowed BP to sharply reduce its debt to $22.8 billion from $27.5 billion at the end of March.

BP brings the second quarter profit tally for the top Western oil and gas companies to $59 billion after rivals including Exxon Mobil and Shell reported record earnings last week.

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.