(Reuters) -Shell reported a smaller fourth-quarter profit on Thursday, as the oil major took a hit from lower refining margins and lower liquefied natural gas (LNG) trading, and said it would buy back shares worth $3.5 billion.

The company said adjusted earnings, its definition of net profit, dropped to $3.66 billion in the quarter ended Dec. 31 from $7.31 billion in the year-ago period.

Since taking over as CEO two years back, Wael Sawan has focused on cutting costs and realigning Shell with its most profitable sectors -- oil, gas and biofuels -- and shifting away from renewable power generation.

The world's top oil and gas companies have experienced a decline in profits throughout 2024, following record earnings in the previous two years, as energy prices stabilized and global oil demand weakened.