Campaigners and politicians have led calls for a windfall tax on energy companies, following the news that BP’s quarterly profits soared to its largest in over ten years.
This comes as wholesale gas prices soar across the globe.
The firm posted an underlying profit of $6.2 billion. It will make $2.5 billion in profits from share buybacks throughout Q2 2022.
The firm said it had experienced “exceptional oil and trading”, a trend that was only “partly” dented by the $25.5 billion hit it took from selling off its stake in Russian integrated energy company Rosneft.
Labour’s shadow chancellor Rachel Reeves has stressed that the argument for one-off windfall tax on energy giants to help combat the rising cost-of-living “cannot be ignored”.
Responding to BP’s announcement, Liberal Democrat leader Ed Davey said: “The Conservative government’s refusal to introduce a windfall tax on the super profits of oil companies is becoming impossible to justify.
“BP is raking in eye-watering profits while millions of people struggle to pay the bills. It is an unforgivable lack of leadership from Boris Johnson at a time of national crisis.
“Oil companies are handing out huge dividends and buying back shares, they could easily afford to pay a little more to help the most vulnerable.”
Friends of the Earth energy campaigner, Sana Yusuf, said: “It’s astonishing that companies like BP are allowed to rake in huge profits while people up and down the country are struggling with soaring energy bills.
“Rishi Sunak must introduce a windfall tax, with the money raised invested in a nationwide energy efficiency programme.
“A street-by-street insulation programme – targeting the hardest hit first – would lower bills, help manage energy demand and improve energy security. With profits like this, it would be short-sighted to do anything less.”
Labour leader Sir Keir Starmer has insisted a windfall tax would not compromise energy investment in Britain.
He told BBC Radio 4’s Today programme this morning: “Of course there needs to be investment for renewables. Of course we need a much stronger energy security strategy. But what we are talking about here is the profit that the companies didn’t expect to make.
“When their own chief executives and directors are saying ‘we have got more money than we know what to do with, we are effectively a cash machine’ then we are in the realms of taxing, a windfall tax, that money which they didn’t expect to make.
“So it doesn’t affect the ordinary investment that you would expect from the oil and gas companies. But choices have to be made when people can’t pay their bills.”