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Shell (RDS.A) to Supply Low-Carbon Marine Lubricants to Carnival

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Zacks Equity Research
·3 min read
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Royal Dutch Shell Plc’s RDS.A subsidiary Shell Marine obtained a long-term agreement from Carnival Corporation & plc CCL to deliver marine lubricants for the latter’s global fleet of 89 ships, with an aim to improve its marine operations.

Notably, cruise operator Carnival will neutralize carbon dioxide (CO2) emissions from the marine lubricants, which it will acquire from the oil and gas supermajor with the help of its nature-based carbon credits.

Shell offers various lubricants for the marine industry through its Shell Marine business and provides integrated business solutions, which include different lubricant products and engineering services for customers to serve the needs of a diverse range of vessels, from oil tankers to small fishing boats. Importantly, the company’s products are commonly used on about 10,000 vessels and are accessible in more than 700 ports across 61 countries.

Shell’s initiative is likely to help Carnival achieve its goal of reducing 40% of its carbon emissions by 2030 for a cleaner, effective and sustainable cruise experience. Notably, Carnival has advanced significantly and hopes that the low-carbon lubricants will help reinforce its goal toward a zero-carbon future.

On its part, Shell’s decision to reduce the shipping industry’s carbon footprint reflects its aim of achieving net-zero emissions by 2050. With the help of its marine lubricants and integrated service offerings, Shell will assist Carnival to optimize engine performance and longevity, thereby, lowering the environmental effects of shipping.

Company Profile & Price Performance

Shell is one of the primary oil majors — a group of U.S. and Europe-based big energy multinationals — with global operations. The company is fully-integrated, as it participates in every aspect related to energy from oil production to refining and marketing.

The company’s shares have outperformed the industry in the past three months. The stock has gained 60.3% compared with the industry’s 41.9% growth.



Zacks Rank & Stocks to Consider

Shell currently carries a Zack Rank #3 (Hold).

Some better-ranked players in the energy space are China Petroleum & Chemical Corporation SNP, currently sporting a Zacks Rank #1 (Strong Buy), and Centennial Resources Development, Inc. CDEV, carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

China Petroleum’s sales for 2021 are expected to increase 25.3% year over year

Centennial’s sales for 2021 are anticipated to rise 95.6% year over year.

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Carnival Corporation (CCL) : Free Stock Analysis Report
China Petroleum & Chemical Corporation (SNP) : Free Stock Analysis Report
Royal Dutch Shell PLC (RDS.A) : Free Stock Analysis Report
Centennial Resource Development, Inc. (CDEV) : Free Stock Analysis Report
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