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| BP profits surge amid calls for windfall tax | BP profits surge amid calls for windfall tax |
| (32 minutes later) | |
| Oil giant BP has reported its highest profit for eight years, amid calls for a windfall tax on energy companies. | Oil giant BP has reported its highest profit for eight years, amid calls for a windfall tax on energy companies. |
| BP posted a profit of $12.8bn (£9.5bn) for 2021, and it made more than $4bn in the final quarter of the year when oil and gas prices surged. | BP posted a profit of $12.8bn (£9.5bn) for 2021, and it made more than $4bn in the final quarter of the year when oil and gas prices surged. |
| The jump in energy prices is leading to big increases in gas and electricity bills for households. | The jump in energy prices is leading to big increases in gas and electricity bills for households. |
| Labour MPs have said energy firms that had profited from higher wholesale prices should pay more in tax. | |
| BP chief executive Bernard Looney said: "2021 shows BP doing what we said we would - performing while transforming." | BP chief executive Bernard Looney said: "2021 shows BP doing what we said we would - performing while transforming." |
| He said the company was delivering for shareholders with $4.15bn of share buybacks and an increased dividend. BP had also made "strong progress" in its transformation towards becoming a low carbon energy business, he said. | He said the company was delivering for shareholders with $4.15bn of share buybacks and an increased dividend. BP had also made "strong progress" in its transformation towards becoming a low carbon energy business, he said. |
| Last year's bumper profits follow a $5.6bn loss BP reported in 2020, when economies around the world were shut down due to the Covid pandemic. | Last year's bumper profits follow a $5.6bn loss BP reported in 2020, when economies around the world were shut down due to the Covid pandemic. |
| But rising demand for oil last year, as economies reopened, combined with supply chain challenges, pushed energy prices sharply higher by the end of 2021. The surge in revenues prompted Mr Looney to describe BP as "a cash machine". | |
| UK households are facing a cost of living crisis, with prices for food and heating rising sharply. Last week it was announced that domestic energy bills would rise 54% in April, prompting the government to step in with a council tax rebate and loans to smooth price rises. | |
| The very same energy prices that have spelt crippling bills for users have prompted BP's boss to describe his operation right now as a "cash machine". A combination of resurgent demand and geopolitical tensions means wholesale gas prices are five times higher than before the pandemic - while oil prices have almost doubled. | The very same energy prices that have spelt crippling bills for users have prompted BP's boss to describe his operation right now as a "cash machine". A combination of resurgent demand and geopolitical tensions means wholesale gas prices are five times higher than before the pandemic - while oil prices have almost doubled. |
| And there's more rewards to be reaped: analysts think BP and Shell could make almost £40bn in profits this year, enough to cover the energy bills of the majority of UK households, renewing calls for a windfall tax. But the chancellor is unconvinced, fearing that it could damage investment in lower carbon forms of energy, particularly given that energy giants' profits, tied as they are to global prices, are very volatile. | And there's more rewards to be reaped: analysts think BP and Shell could make almost £40bn in profits this year, enough to cover the energy bills of the majority of UK households, renewing calls for a windfall tax. But the chancellor is unconvinced, fearing that it could damage investment in lower carbon forms of energy, particularly given that energy giants' profits, tied as they are to global prices, are very volatile. |
| BP's plan to invest in renewables are among the most ambitious in the sector, with an aim to increase spending on low carbon technologies 10-fold, to almost a third of its budget in 10 years. And in the meantime, there are concerns that the UK needs to do more to ensure to boost its own gas supply; at present, more than half our demand is met by imports. | BP's plan to invest in renewables are among the most ambitious in the sector, with an aim to increase spending on low carbon technologies 10-fold, to almost a third of its budget in 10 years. And in the meantime, there are concerns that the UK needs to do more to ensure to boost its own gas supply; at present, more than half our demand is met by imports. |
| But critics say that BP's renewables investment comes from a very low base, and could go further. Yet there could still be scope, given the scale of this windfall - to help foot the bill for help for struggling customers | But critics say that BP's renewables investment comes from a very low base, and could go further. Yet there could still be scope, given the scale of this windfall - to help foot the bill for help for struggling customers |
| Labour and the Liberal Democrats have both called for a windfall tax on the profits of the fossil fuel firms such as BP and Shell to fund more support for households. | |
| "The boss of BP described the energy price crisis as a cash machine for his company - and the people supplying the cash are the British people through rocketing energy bills," said Ed Miliband, Labour's shadow secretary of state for climate and net zero. | |
| "In these circumstances, it is only fair and right for oil and gas producers to contribute to helping the millions of families facing soaring inflation and a cost of living crisis." | |
| Under a plan outlined by Labour last month, North Sea energy producers would pay ten percentage points higher corporation tax for a year to fund £1.2bn of help for households. |