Oil giant BP profits Q2 2022

A BP gas station in Madrid, Spain.

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LONDON – British oil giant BP on Tuesday reported record second-quarter profits, benefiting from a rise in commodity prices.

The British energy giant posted a $8.5 billion gain on underlying replacement costs in the second quarter, used as a proxy for net profit.

That compared to $6.2 billion in profit for the first three months of the year and $2.8 billion for the second quarter of 2021. Analysts had expected BP to report a $6.3 billion profit for the first quarter. report, according to Refinitiv.

BP also announced a 10% increase in its quarterly dividend payout to shareholders on Tuesday, raising it to 6,006 cents per common share.

Shares of BP are up nearly 20% year-to-date.

BP’s results once again underscore the stark contrast between Big Oil’s profit bonanza and those grappling with a deepening cost of living crisis.

The world’s largest oil and gas companies have broken record profits in recent months, following a surge in commodity prices following Russia’s invasion of Ukraine.

For many fossil fuel companies, the immediate priority seems to be returning cash to shareholders through buyback programs.

Last week, BP’s British rival Shell reported record second-quarter results of $11.5 billion and announced a $6 billion share repurchase program, while British Gas owner Centrica restored its dividend after a huge jump in profits in the United States. first half year.

Cost of living crisis

Environmentalists and union groups have condemned Big Oil’s soaring profits and called on the UK government to impose meaningful measures to lower the cost of rising energy bills.

Last month, a cross-party group of UK lawmakers called on the government to step up support for households to pay rising energy bills and outline a nationwide plan to insulate homes.

A price cap on the most commonly used energy tariffs for consumers is expected to rise by more than 60% in October as a result of rising gas prices, bringing the average annual dual-fuel household bill to more than £3,200 ($3,845).

National Energy Action, a fuel poverty charity, has warned that if this happens, 8.2 million households – or one in three British homes – would find themselves in energy poverty. Fuel or energy poverty refers to when a household cannot afford to heat their home to a sufficient temperature.

“It is clear that not everyone is struggling with the energy crisis,” said Sana Yusuf, energy activist at Friends of the Earth, commenting on the results of Shell and Centrica. “These huge gains will be greeted with disbelief by the millions of people in the UK who are faced with skyrocketing energy prices.”

Yusuf called on the British government to impose a tougher windfall tax on energy companies. “Most of these profits should be used to insulate our homes and help low-income households pay for their heating this winter, rather than developing more fossil fuel projects that burn the planet,” Yusuf said.

The burning of fossil fuels, such as oil and gas, is the main cause of the climate crisis and researchers have found that fossil fuel production is “dangerously out of step” with global climate goals.

During his June speech, UN Secretary-General Antonio Guterres called for an end to fossil fuel funding, describing new funding for fossil fuel exploration as “insane”.

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