140 euros a barrel of Brent in March 2022, a gas price multiplied by 15 compared to its usual level, at 350 euros per megawatt hour last summer in Europe… Taking full advantage of the price escalation fueled by the rebound in demand and the war in Ukraine, oil groups have reaped exceptional profits in 2022.
In total, the profits of the big five (Shell, Chevron, ExxonMobil, BP and TotalEnergies) exceeded 150 billion dollars in 2022. Considerable results that reignite the debate on the taxation of “super profits”. General description.
• Total Energies: 20.5 billion dollars
In 2022, TotalEnergies posted the biggest profit in its history. The French group, the fifth largest private oil group in the world, announced on Wednesday a net profit of 20,500 million dollars (19,000 million euros), even better than the 16,000 million registered in 2021, its previous record.
In France, where the activity of TotalEnergies had been in loss for several years, its profit reached 350 million euros last year after deducting the bonus of 550 million euros granted to motorists due to the rise in prices at pumps.
• Shell: $40 billion
By generating 40 billion dollars (36.33 billion euros) in profits in 2022, the British group Shell made it twice as much as in 2021 and far surpassed the previous record of 31 billion dollars in 2008.
• BP: $27.6 billion
The BP oil group reported on Tuesday a record profit of 27.6 billion dollars (25.72 billion euros) for the year 2022. A figure comparable to the 12.82 billion dollars in 2021.
• Exxon: $55.7 billion
The American Exxon also revealed record profits for 2022. During this fiscal year, the oil major registered a profit of 55.7 billion dollars, compared to 23 billion dollars in 2021. It is also 10 billion more than the previous record, which dates from 2008.
• Chevron: 36,500 million
US oil company Chevron posted a net profit of $36.5 billion in 2022, more than double the previous year. The group, which published its quarterly and annual results last Friday, surpassed its previous record, set in 2011, by nearly $10 billion.
• Equinor: 28.7 billion
Norwegian energy giant Equinor has also posted record results for 2022 thanks to rising prices. Its net profit more than tripled last year to $28.7 billion.
Joe Biden denounces “outrageous” profits
In the midst of the energy and climate crisis, these amazing results have not gone unnoticed. On Tuesday, Joe Biden himself called these benefits “outrageous.” Especially since if oil and gas prices have fallen from the peaks reached in 2022, there could be further increases in 2023, “because the war in Ukraine is far from over,” Adi Imsirovic, a researcher at the Institute of Oxford Energy Studies. .
The manna amassed by the majors is currently creating a headache for the political class across the West, in the context of the cost of living crisis. “I’m doing my part to lower prices, it’s time for Big Oil to do their part,” Joe Biden had already said on Twitter last week.
In France, the announcement this Wednesday of TotalEnergies’ profits should further fuel the debate to tax these “super profits” more. In Britain, the government introduced a windfall energy profit tax in May 2022, as did the European Union at the end of September, with a “temporary solidarity contribution”, challenged in court by Exxon.
Joe Biden wants to quadruple the share buyback tax
If the rebound in demand after the Covid-19 pandemic had already benefited the big companies in 2021, everything got out of control in 2022: prices skyrocketed due to the conflict in Ukraine, Western sanctions against Moscow and the decline in Russian exports. .
To be sure, oil companies are investing more and more in solar, wind and other renewables “but not as much as what they pay out to shareholders,” says David Elmes, a professor at Warwick Business School, as BP slows down its energy transition. That is why Joe Biden has said that he wants to increase the share buyback tax that went into effect in January from 1 to 4%.
And now? “In my opinion, prices will increase due to the oil embargo imposed by the West on Russia (…) therefore, these companies would be as profitable in 2023 as in 2022,” continues Moez Ajmi. Especially since companies will be able to count on a demand “clearly still there, especially with the resignation of the zero Covid policy in China”.
However, this demand for oil and gas continues to be supported by tens of billions in subsidies for consumer bills, which “only prolong the crisis,” estimates Adi Imsirovic. Wanting to “subsidize fossil fuels (…) demand continues to grow instead of falling” while “the best remedy against high prices is high prices,” he adds. For the researcher, EU governments should first be content with helping “the poorest”.
Source: BFM TV
