LONDON (Reuters) - Shell on Thursday reported first-quarter adjusted earnings of $7.7 billion, sharply beating expectations, on the back of strong oil trading and higher refining margins.

The oil major also announced it will repurchase a further $3.5 billion of its shares over the next three months, at a similar rate to the previous quarter. Its dividend remained unchanged.

"Shell delivered another quarter of strong operational and financial performance, demonstrating our continued focus on delivering more value with less emissions," CEO Wael Sawan said in a statement.

Analysts had expected first-quarter adjusted earnings of $6.46 billion, against $9.65 billion a year earlier.

The company had posted $7.3 billion in the fourth quarter of 2023, boosted by strongLNG trading results.

Shell shares have gained about 14% this year, buoyed by Sawan's efforts to cut costs and focus the company on its most profitable oprations.

Rivals Exxon Mobil, Chevron and TotalEnergies last week reported a drop in profits from a year earlier, reflecting a sharp downturn in natural gas prices after a warmer than usual Northern Hemisphere winter cut demand and pushed up inventories.

WEAKER LNG

Shell's chemicals and products divisions, which include refining and oil trading, registered a more than threefold rise in adjusted earnings from the previous quarter to $2.8 billion, driven by strong gains from trading and refining.

The results were offset by weaker results from its flagship liquefied natural gas (LNG) trading business compared with the previous quarter as well as unfavourable tax movements, Shell said.

Shell's LNG production rose in the quarter by 7% from the previous three months to 7.58 million metric tons while sales dropped by 7% to 16.87 million tons.

The company's overall oil and gas production rose by 3% in the quarter to 2.91 million barrels of oil equivalent per day.