Royal Dutch Shell
Shell terminated its arctic operations in Alaska, costing the firm millions Getty

Shell has reported it made a $1.77bn adjusted profit in the third quarter, a fall of 70% from the same period in 2014. The number is well below the already soft market expectation of $2.92bn.

The firm is dealing with an oil price that has halved over the last year, due to oversupply and limited demand. The Royal Dutch company turned a loss attributed to shareholders of $7.42bn (£4.91bn, €6.85bn), from a profit of $4.36bn in the third quarter of 2014.

"Shell's integrated business and our performance drive are helping to mitigate the impact of low oil prices on the bottom line, in what is a difficult environment for the industry today," Shell boss Ben van Beurden commented.

"While our cash flow and our operating performance in the quarter were strong, the headline numbers we're reporting today include substantial charges. These charges reflect both a lower oil and gas price outlook and the firm steps we are taking to review and reduce Shell's longer-term option set."

Shell has shown efforts to cut overhead costs over the last months. This included the announcement of 6,500 job cuts in July, and a 20% cut in capital expenditure, trends also seen at competitor BP.

Van Beurden hinted that more steps might be taken by Shell in an effort to minimise spending as he announced the $8.5bn charge to deal with unprecedented costs as a result the termination of the arctic drilling operation in Alaska and of the fall in oil prices.

"These are difficult, but impactful decisions," he said. "I am determined that Shell will become a more focussed and competitive company as a result."

Van Beurden made a short mention of the BG acquisition saying that the takeover is still on track to be completed in the first half of 2016. The $72bn agreement was recently approved by EU antitrust regulators.