THE HAGUE. Aug 7: The Asian crisis will continue to drag down profits as oil-producing countries look to Europe and North America to take up Asia's slack and because the region now produces cheap chemicals. Royal Dutch Sh-)1 pre-dicted yesterday, reports AFP.

The Anglo-Dutch oil giant announced its first half net profit had plunged 21.3 per cent this year to 3.193 billion dollars from 4.061 billion dollars in the first half of last year.

In the second quarter, the company's operating profits fell by 36.2 per cent to 2.518 billion dollars from 3.948 billion dollars as the persistent slump In oil prices. Europe's warmer weather and the continuing economic crisis in Asia hit business.

"The economic events in Asia affected result." said Shell's President. Maarten Vanden Bergh, explaining that the crisis had particularly dragged down profit in the chemicals sector, off 28 per cent in the second quarter.

"We felt the Asian crisis mainly in chemicals, as it had an effect on prices throughout the world." Vanden Bergh explained.

"Chemicals trading conditions deteriorated in the quarter as the impact of the Asia-Pacific slowdown was increasingly felt globally." Shell said.

"Feedstock (raw material) prices continued to fall. However. this was offset by the fall in product prices as low demand in Asia-Pacific increased low-price exports from the region".

"Globally the outlook for the second half of the year is for further, deterioration." Shell predicted.