BP scales back climate targets as profits hit record. Energy giant BP reported record profits as it scaled back plans to cut oil and gas output by 2030.
The company’s profits more than doubled to $27.7bn (£23bn) in 2022 as energy prices rose after Russia attacked Ukraine.
Other energy companies have seen similar gains, with Shell reporting record revenue of nearly $40 billion last week.
This has led to calls for energy companies to pay more tax when people’s bills go up.
BP chief Bernard Looney said the British company was “helping to provide the energy the world needs. While investing in the transition to green energy.
But it came as the company scaled back plans to reduce carbon emissions by reducing oil and gas production.
The company – which was one of the first oil. Gas giants to announce plans to reduce emissions to zero. By 2050 – previously promised to reduce emissions by 35-40% by the end of the decade.
But on Tuesday it said it was now targeting a 20-30% cut. Said it needed to continue investing in oil. Gas to meet current demand. Greenpeace is a climate campaign group. Whose voice has been record by the AZ24 News on the impact of oil and gas. Gas production on the environment. Said BP’s new strategy “seems to be seriously undermin by pressure from investors. Governments to make even more dirty money from oil and gas”.
Energy prices started rising after the end of the Covid-19 shutdown. But rose sharply in March last year after Russia attacked Ukraine, sparking concerns about global supplies.
BP scales back climate targets as profits hit record; The price of Brent crude oil went to almost 128 dollars per barrel. But has since fallen back to around 80 dollars. Gasoline prices also rose, but have fallen from their peak.
This resulted in profits for energy companies but also increased household and business energy bills.
Last year, the government introduced an unusual tax – called the Energy Profits Levy – on the “extraordinary” profits of energy companies.
Initially, the rate was set at 25%, but has now been increase to 35% and only applies to profits from oil. Gas production in the UK. Oil and gas companies pay 30% corporation tax on their profits. Plus an additional 10%, making the total tax rate 75%.
However, they can reduce the taxes they pay by taking into account losses. Costs such as the decommissioning of North Sea oil platforms.
BP said its UK business, which accounts for less than 10% of global profits, will pay $2.2 billion in tax by 2022, including $700 million in energy profits tax.
Windfalls of war’
Speaking to the AZ24 News about the government’s stance, Andrew Griffith, the economic secretary at the Treasury, said the emergency tax was the “right balance” between helping families with living costs and securing Britain’s energy supply. He said his goal is to contribute to the industry’s profits returning to the economy
Speaking to the AZ24 News about his experience in the industry, Nick Butler, former BP chief executive and now visiting professor at Kings College, said oil and gas prices would not remain “exceptionally high” forever.
“This is a temporary situation. Oil and gas prices are going down and the windfall these companies are getting is not going to last.” In a year when BP boss Bernard Looney described the company as a money machine, it’s no wonder the progressive think tank IPPR called the profit outrageous as millions struggled to pay their bills.
The company paid £1.8 billion in tax in the UK – a significant increase on the previous estimate – as the UK tax rate on profits rose to 75% due to extraordinary taxes.
Labor says taxes should be even higher and provide more incentives to invest in renewables. Perhaps most controversially, BP has announced that it will not meet its targets to reduce oil and gas production by 2030, as it has said it will balance investment in low-carbon projects with new investment in fossil fuels and extending life current oil. and gas projects.
While shareholders make the least noise today, their voices are arguably loudest when BP’s rivals, such as Shell and Exxon, are also posting record profits.
Presentation of gray lines
Labor and the Lib Dems were called to explain the opposition’s position, saying the benefits were outrageous and calling on the government to increase the extra tax.
The government has had to step in to cap household energy bills, with the average household now paying £2,500 a year, although this is still more than double what it was a year ago.
Bills will also be capped at £3,000 from April, although experts expect households to pay less than this due to the recent drop in gas prices.
In addition to reporting record profits, BP increased shareholder payouts by 10%.
BP’s performance follows similarly strong earnings reported by rivals Shell, Exxon Mobil and Chevron last week.