The British company has reported the highest annual profit in its 115-year history, sparking outrage among those struggling to pay their energy bills.
Energy giant Shell has announced record annual profits approaching $40 billion after oil and gas prices soared in the wake of Russia’s invasion of Ukraine last February.
UK business earnings in 2022 are the highest in 115-year history, angering many Britons struggling with a cost-of-living crisis largely caused by rising energy prices.
Shell’s annual profit soared to $39.9 billion, more than doubling from the previous year and surpassing the all-time high of $31 billion set in 2008.
Earnings mirror those reported by the company’s U.S. rival earlier this week, and the government is sure to put pressure on it to raise taxes further in this area.
The results demonstrate Shell’s “ability to provide critical energy to its customers in a volatile world,” new CEO Wael Sawan said in a statement.
Russia’s war in Ukraine has rocked global energy markets and Shell, like its competitors, has benefited through its large global footprint and major trading operations.
Governments struggling with rising energy prices have responded by imposing contingent taxes on the energy sector, including the UK.
Shell said it expects costs related to fines to be about $2.4 billion in 2022. The company has announced that it will pay tax in the UK for the first time since 2017.
“It’s time to make the polluters pay the price.”
But critics say Britain’s Conservative government needs to toughen windfall taxes on energy company earnings after Shell’s big profit announcement.
“British citizens face a 40% increase in energy prices in April. [Prime Minister] By denying a proper windfall tax, Rishi Sunak allows fossil fuel companies to make huge profits,” said Ed Miliband, Shadow Climate and Net Zero secretary of the opposition Labor Party. said in a Twitter post.
As it stands, companies have to pay a 35% tax on profits made from drilling for oil and gas in the UK. However, this does not apply to other activities such as selling fuel at petrol stations or refining petroleum.
The scheme offers companies big savings when investing in fossil fuel mining in the UK. For every £1 ($1.23) you spend on this, you can claim 91 pence ($1.12) in tax relief.
Former leader of Britain’s Green Party, Caroline Green, said the government was an “accomplice” to energy companies she accused of “polluting our planet”.
“For a livable future, we must banish fossil fuels for good,” she said in a Twitter post.
NGO Greenpeace said it was “time to make the polluters pay”.
“While Shell is posting record profits, people around the world are counting the damage caused by record droughts, heat waves and floods. This is driven by Shell’s business model.” said the same group.
