Shell failed to deliver another bumper crop of profits in the last quarter, with the business falling short of market expectations.

The oil giant said on Thursday that it had seen its adjusted earnings more than halve in the three months to the end of June when compared with the same period a year ago.

A drop had been expected, but markets failed to forecast just how far earnings would fall.

Adjusted earnings reached just under 5.1 billion US dollars (£3.9 billion) during the quarter, down from 11.5 billion dollars (£8.9 billion) a year earlier.

Analysts had expected the figure to reach almost 5.6 billion dollars (£4.3 billion), according to a consensus compiled by the company.

It is also a reduction from the oil major’s record first-quarter results, which saw it make 9.6 billion (7.6 billion) in adjusted earnings in just three months, well ahead of expectations at the time.

Since then Shell has courted controversy by saying it will no longer try to reduce its oil production by 1%-2% per year until the end of this decade.

The company said it has already achieved this target because it sold off some of its oil fields, allowing other companies to produce the oil instead.

It said it will continue to produce about as much oil as it does today until 2030.

On Thursday, chief executive Wael Sawan said: “Shell delivered strong operational performance and cash flows in the second quarter, despite a lower commodity price environment.

“Today we are delivering on our … commitment of a 15% dividend increase.

“We are going further on our buyback guidance by commencing a 3 billion dollar (£2.3 billion) programme for the next three months and, subject to board approval, at least 2.5 billion (£1.9 billion) at the third-quarter 2023 results.

“As we deliver more value with less emissions, we will continue to prioritise share buybacks, given the value that our shares represent.”