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Royal Dutch Shell has slashed its dividend for the first time since World War II after profits were wiped out by a historic collapse in oil demand caused by the coronavirus pandemic.

The Anglo-Dutch firm, one of the world’s largest oil companies, said in a statement Thursday that it will cut its quarterly dividend to 16 cents per share, from 47 cents previously. It posted a net loss of $24 million for the first quarter of 2020, compared with a profit of $6 billion in the same period a year ago.

Shares in the company plunged as much as 8% in London on Thursday morning.

“The world has seriously changed over the last few months,” Royal Dutch Shell (RDSA) CEO Ben van Beurden said in a video recorded from his home and posted to the company’s website. “The global economic decline and uncertain outlook may have significant impacts on our profitability, cashflow and balance sheet,” he added.

Cutting the dividend will “reinforce our resilience, preserve the strength of our balance sheet and support value creation in the long term,” Van Beurden added.

Shell had furiously tried to avoid slashing its dividend — a key draw for investors — but the coronavirus pandemic has made it crucial for the company to preserve cash, as demand for oil from airlines, factories and motorists evaporates.

The International Energy Agency said in a report Thursday that the drop in global energy use this year is like wiping out demand from all of India, a country of 1.3 billion people and the world’s third biggest consumer. Demand for oil, gas and coal had been hammered, it added. Only renewable energy was proving resilient.

Such dynamics — combined with the supply glut that resulted from a brief but brutal price war between Saudi Arabia and Russia — have dealt a gut punch to oil markets. Last week, US oil prices turned negative for the first time ever as traders paid people to take crude off their hands.

Shell’s dividend cut will free up about $10 billion, analysts at Wood Mackenzie said in a note. If dividends are reduced longer term, it would free up cash to invest in the zero-carbon energy sector, added senior vice president Tom Ellacott.

Shell has announced plans to shift to renewable energy as it aims to achieve net zero carbon emissions from its own operations by 2050. It has also said it will aim for emissions from products it sells to customers to be fully offset.

“These are difficult and extraordinary times, but we must maintain focus on the long term,” Van Beurden said Thursday.

Norwegian oil company Equinor slashed its dividend by 67% last week. But BP (BP), which reported a 67% decline in first quarter profit on Tuesday, maintained its dividend at 10.5 cents per share while saying it would keep it under review.

The decision to pay a dividend was based on the performance of the business in the first quarter and “subsequent decisions will be taken based on the context at that time,” BP CEO Bernard Looney told analysts.

ExxonMobil and Chevron (CVX), which report earnings on Friday, have vowed to defend their dividends.

“Shell’s dividend cut has thrown down the gauntlet to the supermajors,” said Ellacott. “BP, Chevron, ExxonMobil and Total (TOT) are due to pay out $41 billion of dividends in 2020. Combined payouts would fall by $27 billion if they all cut by 66%.”

Norway cuts production

Oil prices have recovered a little in recent days but remain at very depressed levels and producers are under enormous pressure to cut output to soak up the supply glut.

OPEC and its allies, including Russia, have agreed to cut production by a record 9.7 million barrels a day for the next two months, starting Friday. Norway said Wednesday that it too would cut output, by 13% in June, or 250,000 barrels a day. It will also delay the start of production at several fields until 2021.

“We are currently facing an unprecedented situation in the oil market,” Norway’s minister of petroleum and energy, Tina Bru said in a statement.

Oil companies are facing a bleak longer term outlook, with some analysts warning that demand may never return to its 2019 record high, as the crisis accelerates shifts that were already underway in energy markets, such as the switch to renewables, and has a lasting impact on the way people work and travel.

If governments are slow to lift quarantine rules or a second wave of the coronavirus hits, oil demand will remain depressed for longer and changes to behavior will become more entrenched, according to Jim Burkhard, head of crude oil research at IHS Markit, a research firm.

— Julia Horowitz and Matt Egan contributed to this report