Royal Dutch Shell beat all forecasts on Tuesday with a 12 percent rise in first-quarter current cost of supply (CCS) net income, helped by record oil prices which broke $100 a barrel in the period.

Singapore state investor Temasek Holdings has set up an oil exploration subsidiary to help diversify its financials-heavy portfolio, entering a sector crowded with expanding national oil companies and majors.

Oil majors can't get ahead of production declines despite spending on unconventional sources, an energy sector investment banker says.

Royal Dutch Shell said its oil and gas reserves held stable in 2007 despite expectations of a drop, but added its growing focus on unconventional projects would limit growth until after 2010.

Oil group BP stepped up the pace of its turnaround on Tuesday, outlining a plan to slash its workforce by 15 percent, cut over $1 billion in costs and adopt a more generous dividend policy, boosting its shares despite a big drop in profits.

Oil giant Royal Dutch Shell posted record European company earnings of $27.6 billion in 2007, but fourth-quarter profit missed forecasts as a fall in production dampened the benefit of high oil prices.

Royal Dutch Shell's oil sands upgrading plant near Edmonton, Alberta, caught fire late on Monday and the company said it was taking units off line after crews extinguished the blaze.