The main reason: The price of crude oil has surged some 64 per cent, using North Sea Brent as a benchmark, to an average $21.10 a barrel during the latest quarter, compared with $12.85 a barrel a year earlier. But vigorous cost-cutting, especially after last year's oil-price collapse, has also swelled the bottom line of both two oil giants.

``Both companies are in delivery mode right now,'' says Fergus MacLeod, an analyst at Deutsche Bank in Edinburgh. For instance, he says, the Anglo-Dutch ``Shell will show a massive improvement, quadrupling its profits from the upstream'' - the industry term for oil-exploration and production activities. MacLeod reckons Shell's after-tax operating income from upstream activities will jump to $1.25 billion in the latest quarter, compared with $288 million a year earlier. Income from chemicals operations also is expected to rise, but will be more than offset by a decline in earnings from refining and marketing operations.

When all that is added up, MacLeod expects Shell to report net income of some $1.8 billion for the latest quarter, up from $841 million a year ago. And that's in the lower half of analysts' estimates for Shell's third-quarter net income, ranging from $1.7 billion to $2 billion.

In contrast to Shell's recent resurgence, BP Amoco has been a darling of analysts for some time because the company has continued to deliver on its promises of good results. For the latest quarter, Jon Rigby, an analyst at Paribas in London, expects BP to report ``about the best results on a quarter to quarter, or year to year basis'' in the international oil industry. BP Amoco - which has a way of squeezing out a lot of income from its assets - is doubly blessed when it comes to rising crude-oil prices because its operations are heavily concentrated on producing oil. Mr. Rigby, for one, expects BP Amoco's oil exploration and production operations to account for more than two-thirds of third-quarter income.

The Wall Street Journal