Energy giants to smash annual profit records

Some of the world’s largest oil and gas companies are preparing to report record annual profits, posting extraordinary revenue after a year of volatile fossil fuel prices amid Russia’s attack on Ukraine.

Major oil companies Exxon MobilAnd chevronAnd BPAnd shell And Total energy It is set to report combined earnings of $190 billion for 2022 when final quarterly results are announced in the coming days, according to analyst estimates compiled by Refinitiv.

Flush with cash, the energy giants are expected to use their windfall to reward shareholders with higher dividends and buy back shares.

US President Joe Biden has previously accused oil companies of making moneywindfall of war“while at the same time refusing to help lower gas prices at the pump for American consumers. In June of last year, Biden singled out ExxonMobil for making it.”More money than God. “

Exxon Mobil spokeswoman Erin McGrath told CNBC that higher energy prices are “due largely to an imbalance between supply and demand” and that the company’s investments over the past five years are driving quarterly results.

McGrath said Exxon sees its success as “a formula” and “by which we can produce the energy and products that society needs — and — be a leader in reducing greenhouse gas emissions from our operations as well as those from other companies.”

Spokespeople for BP and Shell did not want to comment ahead of full-year results, while Chevron and TotalEnergies did not respond when contacted by CNBC.

In recent quarters, Big Oil executives said the significant turmoil in global energy markets due to the war in Ukraine had reaffirmed the importance of helping solve the “energy triad.” This is according to a statment To investors from Bernard Looney, CEO of BP, late last year, he points to “safe, affordable, low-carbon energy.”

“They are benefiting from the current increase in oil and gas prices, and they are betting on it. And what you’re seeing is actually an increase in investment in oil and gas,” Agathe Bonnefort, head of the oil campaign at the transport and environment NGO, told CNBC. Over the phone.

“I think given that oil and gas prices are likely to remain high, it’s important for us to think about the fact that these earnings will remain high at the same time that many households are suffering from energy prices,” Bonfort said.

“There is not much benefit [in] “Increasing revenues and supporting the industry at the same time,” she added.

The oil and gas industry has sought to stress the importance of energy security amid calls for a rapid transition to renewable energy sources, usually highlighting this Fossil fuel demand remains high.

“I called 2022 which is the year the empire came back on the offensive,” Marc van Baal, founder of Volo This, a Dutch contributing activist, told CNBC by phone.

“What we’ve seen happen in 2022 is that major oil companies have used higher oil prices and the energy crisis to convince investors that the energy crisis should outweigh the climate crisis – and that has caused a setback,” Van Pal said.

After failing to make several climate decisions in 2022, Van Baal said it was clear from discussions with oil majors that they were once again determined to fend off pressure from activists and shareholders and continue their core oil and gas business.

“The position of the oil industry is that we have a very handsome business model and we will defend it with all our might,” Van Baal said. “The reason it’s so handsome is because there are many external factors not within its costs — and of course, the biggest is the cost of climate change.”

Van Baal added, “I hope it’s not with the boards of directors of these big oil companies, I hope investors realize we don’t have time for another round of discussion, another year of engagement, another year of benefiting from the doubt.”

Record profits from the largest oil and gas companies in the West also renewed their calls higher taxesEspecially at a time when rising gas and fuel prices have fueled inflation around the world.

“We should all be calling out for profiteering like this,” said Alice Harrison, fossil fuels campaign leader at the advocacy group Global Witness.

She described the energy giants’ historical revenues as “disgraceful” given that “much of this money is being made at the expense of millions of people who have been pushed into poverty by the high cost of gas.”

“A windfall tax to help those struggling to pay their bills, along with a big increase in renewable energy and home insulation, would end the era of fossil fuels that hurt people and the planet alike,” Harrison told CNBC by email.

The burning of fossil fuels, such as coal, oil and gas, is certainly the main driver of the climate emergency.