BP’s profits double to $27.7 billion
LONDON — British energy firm BP reported record annual earnings Tuesday, fueling demands that the U.K. government boost taxes for companies benefiting from the high price of oil and natural gas after Russia’s invasion of Ukraine.
London-based BP said underlying replacement cost profit, which excludes onetime items and fluctuations in the value of inventories, jumped to $27.7 billion in 2022 from $12.8 billion a year earlier. That beat the $26.8 billion BP earned in 2008, when tensions in Iran and Nigeria pushed world oil prices to a record of more than $147 a barrel.
BP also increased its quarterly dividend by 10% and announced plans to buy back an additional $2.75 billion of stock from shareholders.
But the good news for BP shareholders is likely to be tempered by the public fallout, particularly in its home country. High oil and gas prices have hit Britain hard, with double-digit inflation fueling a wave of public sector strikes, soaring food bank use and demands that politicians expand a windfall tax on energy companies to help pay for public services.
Ed Miliband, the opposition Labour Party’s spokesman on climate issues, called on the U.K. government to bring forward a “proper” windfall profits tax on energy companies.
“It’s yet another day of enormous profits at an energy giant, the windfalls of war, coming out of the pockets of the British people,” Miliband said.
Similar censure was directed at London-based Shell last week, when it said annual earnings doubled to a record $39.9 billion last year.
Bumper profits for energy companies around the world have sparked demands that the fossil fuel industry do more to offset high energy bills even as they cut climate-damaging carbon emissions. U.S.-based Exxon Mobil posted record earnings of $55.7 billion last week.
Last year, Britain approved a 25% windfall profit tax on earnings from oil and gas produced in the U.K., with the levy increasing to 35% in 2023. But opposition leaders have criticized the government for allowing energy companies to reduce the tax by investing in the U.K.