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Friday, December 9, 2022

Energy: billions in profits – Biden threatens oil companies

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Jane
Jane
Jane Stock is a technology author, who has written for 24 Hours World. She writes about the latest in technology news and trends, and is always on the lookout for new and innovative ways to improve his audience’s experience.
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Energy prices are rising significantly – the oil companies are also benefiting from this. Now two other companies have presented balance sheets with billions in profits. The criticism is getting louder.

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The energy companies BP and Saudi Aramco are making significantly more money because of the rise in oil and gas prices as a result of the Ukraine war. Meanwhile, government criticism has not stopped: US President Joe Biden brought up an excess profits tax in his country before the congressional elections.

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The British group BP wrote the second-highest quarterly profit ever in the past quarter. Adjusted net income rose to $8.15 billion, the company announced on Tuesday. That was significantly more than experts had expected. A year ago, the group reported adjusted earnings of $3.3 billion.

The Saudi Arabian state-owned company Aramco earned a total of 41.6 billion dollars, around 40 percent more than a year earlier. This is the second-largest net profit since the IPO, the company said. Only between April and June was it larger at $48 billion.

Lots of winners

As a result of the Russian invasion of Ukraine, oil prices had initially risen to their highest level in 14 years. They then declined as inflation and tightening central bank policies slowed the global economy. A barrel of North Sea Brent cost 94.81 US dollars on Tuesday, around a fifth more than at the beginning of the year.

Other companies also benefit from the prices. US oil industry leader Exxonmobil had presented the largest quarterly profit in its company history. Competitors such as Chevron, Total, Repsol and Shell also clearly exceeded the billions in profits in the same quarter of the previous year.

While investors benefit from the profits, dissatisfaction is growing among politicians, who are struggling with the effects of inflation and rising interest rates. As a result, the UK already has an excess profit tax affecting Shell and BP.

appeal to responsibility

Now Biden also brought such a tax into play. “The oil industry has a choice. Either it invests in America by lowering consumer prices at the pump and increasing production and refining capacity. Or it pays a higher tax on its excessive profits and faces further restrictions,” Biden said Monday. Those who make such high profits have a responsibility to act in the interests of consumers, society and the country. His team will work with Congress to explore options.

Biden had previously voiced his displeasure with share buybacks and dividends, and urged oil companies to put more money into production. Biden’s Democrats want to defend their majorities in the House of Representatives and Senate in next week’s congressional elections. However, even with a narrow election success, an excess profit tax is unlikely to stand a chance in Congress.

Source: Stern

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