Royal Dutch Shell has signalled that the steep rise in its debts is coming to end as its chief executive said it would not need to borrow any more money if oil remains at about $80 per barrel.

The comments from Peter Voser, who took over at the top of Shell in July, are a sign of how the oil industry has recovered thanks to the rebound in the oil price to about $76 yesterday from its low point of less than $33 in February.

They also reflect the boost to Shell's cash flow from cost reductions and from two huge gas projects in Qatar scheduled to come on stream by the end of next year.

Shell has been cutting costs aggressively under Mr Voser: shedding 5,000 jobs this year, forcing staff to reapply for 15,000 posts, driving down prices charged by some suppliers, such as drilling contractors, and shifting some procurement to China.

Mr Voser said there would be an unspecified number of further redundancies next year and “tough targets” for further cost reductions. However, the cuts already made, and a slowdown in capital spending to $28bn- $29bn next year from $32bn this year, are expected to be enough to stabilise Shell's debts.

Shell's preferred measure of gearing – net debt as a proportion of capital employed (net debt plus shareholders' equity) – is rising from less than 6 per cent at the start of the year to an expected 20 per cent or so at the end of the year. However, Mr Voser signalled that at present oil prices, this level would not rise any further next year.

In Qatar, the Pearl plant to convert natural gas to liquid fuels, and the Qatargas 4 project to produce super-cooled liquefied natural gas for export, are scheduled to come on stream by the end of 2010 and ramp up production in 2011.

Pearl has far exceeded its original budget of about $5bn, and is now expected to cost $18bn-$19bn.

However, at $70 oil the two projects will contribute $4bn a year to the company's cash flow when fully operational: equivalent to almost a fifth of Shell's likely operational cash flow this year.