Shell Reports 24% Profit Jump as 119,371 UK Companies Face Insolvency
The divergent fortunes of UK businesses have been thrown into sharp relief by Shell's latest earnings report. The energy giant announced profits of $6.92bn (£5.1bn) for the first three months of the year, up from $5.58bn in the same period a year earlier, according to BBC Business[1]. Meanwhile, CompanyPulse company register data reveals that 119,371 UK companies are currently undergoing insolvency procedures[2].
Energy Sector Profits Surge Amid Oil Price Volatility
Shell's results follow similar announcements from other oil majors. BP reported its profits for the first three months of the year had more than doubled, while Norway's Equinor said profits in the first three months of the year had hit $9.77bn, its highest quarterly profit for three years[1].
The profit surge has been driven by sharp movements in oil prices since the start of the US-Israel war with Iran. Before the conflict began, Brent crude was trading at around $73 a barrel. Since then, oil has seen sharp swings - peaking above $120 at one point, but also falling below $100 on other occasions[1].
Shell chief executive Wael Sawan attributed the results to "our relentless focus on operational performance in a quarter marked by unprecedented disruption in global energy markets"[1]. The company's oil trading business has particularly benefited from the price volatility, which typically widens the gap between buying and selling prices, enabling traders to make bigger profits[1].
The Scale of UK Corporate Distress
While energy giants report bumper profits, the broader UK business landscape tells a different story. According to CompanyPulse data, the 119,371 companies currently in insolvency procedures break down as follows: 109,693 in liquidation, 5,183 in administration, 3,974 in voluntary arrangements, and 521 in receivership[2].
These figures represent companies at various stages of financial distress, from those attempting restructuring through voluntary arrangements to those undergoing full liquidation. The scale suggests widespread impact from current economic pressures.
The CompanyPulse company register currently tracks 5,827,785 total companies, of which 5,539,906 are listed as active[2]. This means that approximately 2% of all UK companies are currently in some form of insolvency procedure.
Supply Chain Disruptions Impact Operations
Even profitable energy companies are facing operational challenges. Shell reported that its oil and gas output had fallen by 4% compared with the final three months of last year due to the conflict. The company's LNG production in Qatar has been shut down since early March, and its Pearl GTL site in Qatar has been damaged by attacks[1].
The closure of the Strait of Hormuz, which usually carries about 20% of global supplies of oil and liquid natural gas, has created significant logistical challenges[1].
New Company Formation Continues Despite Challenges
Despite the challenging environment, new company formations continue at a steady pace. CompanyPulse data shows 13,797 new incorporations in the seven days from 2 May to 8 May 2026[2]. Daily incorporation rates have shown significant variation, ranging from as low as 21 companies on 12 April 2026 to as high as 4,221 on 27 April 2026[2].
The most recent complete trading day, 7 May 2026, saw 2,505 new incorporations[2]. This ongoing business formation activity suggests that despite the current economic headwinds, entrepreneurs continue to launch new ventures.
Regulatory Enforcement Continues
Against this backdrop of economic divergence, regulatory enforcement continues. The Insolvency Service recently announced a four-year directorship ban for Suzanne Harley-Davies, who failed to "exercise control of the affairs" of Namare GRP Ltd and TPG GRP Limited during 2023 and 2024[3].
Both companies were wound up in the public interest in 2024 for their role in supporting the Atherton scheme, which allowed directors to sell distressed companies for £1 to avoid formal insolvency proceedings. Directors paid fees of between £5,000 and £20,000 to have their companies sold under this scheme[3].
The continued focus on director conduct, even as thousands of legitimate businesses struggle with economic pressures, underscores the importance of proper corporate governance during times of financial stress. As more companies face distress, the distinction between legitimate business failure and improper conduct becomes increasingly important for regulators, creditors, and the broader business community.
The current economic landscape reveals a stark divide between sectors benefiting from geopolitical disruption and those bearing its costs. While energy companies report exceptional profits driven by price volatility and trading opportunities, the broader UK business community faces significant challenges, with over 119,000 companies currently in insolvency procedures. This two-speed economy raises questions about resource allocation, support mechanisms, and the long-term sustainability of current market dynamics.