Since Russia's invasion of Ukraine in February 2022, oil majors in Europe and the United States have made record profits totaling more than 260 billion euros, according to Global Witness, a non-leading organization.
A report released by Global Witness on Monday (19 February) shows that since Russia's invasion of Ukraine, the five largest Western oil and gas companies – Shell,United KingdomOil, Chevron, ExxonMobil and TotalEnergies – have amassed more than $281 billion (€261 billion) in profits.
Since the wake of the Covid-2019 pandemic, wholesale energy has been significantly more significant with the outbreak of the conflict in Ukraine.
Economic sanctions due to Russia's invasion of Ukraine, as well as Moscow's decision to halt gas imports to certain countries in retaliation, have pushed up European gas**, triggering a global energy crisis.
Therefore,United Statesand soaring profits for oil and gas companies in Europe.
In the face of these record profits, Joe Biden of the United States accuses oil companies of "profiting from the war", and UN Secretary-General António Guterres has also denounced these companies as "choking the throat of humanity".
Patrick Galli, senior fossil fuel investigator at Global Witness, said: "No matter what happens on the front lines, fossil fuel giants are the main winners of the war in Ukraine. ”
They have amassed untold riches on the basis of death, destruction, and constant energy. ”
According to Global Witness, British Shell and BP have earned a profit of 75 billion pounds, which is enough to cover the entire electricity bill of a British household for 17 months.
In addition to reversing its decision to reduce oil production over the next decade, Shell has also decided to lay off 200 people from its green jobs sector.
Record profits have also allowed oil majors to strengthen their positions by acquiring smaller oil and gas companies, with Chevron buying Hess for $53 billion and ExxonMobil for $60 billion.
Global Witness notes that all of these companies together have more carbon emissions per year than BrazilAustraliawithSpainIt adds up to more.
The top five fossil fuel producers paid an unprecedented $111 billion to shareholders in 2023. This amount is equivalent to about 158 times the commitment made to countries vulnerable to climate change at COP28.
French oil giant TotalEnergies paid 15 billion euros to shareholders, which could exceed the 10 billion euros paid by France** to cover losses caused by storms and droughts in 2022.
Oil companies) are now spending their proceeds on handouts for investors and more oil and gas production, which Europe does not need and that the climate cannot sustain," Galey said.
Taxes on fossil fuels
Sebastian Mang, of the London-based New Economics Foundation, said the staggering profits amassed by the big oil companies were a clear example of a flawed economic system favoring fossil fuel giants over ordinary people.
It's time to dramatically raise taxes on profits from companies such as Shell, Total and BP, ban new oil and gas projects around the world, and accelerate public green investment," Mann told Euractiv. "If we are to overcome the climate crisis, our economic system must prioritize sustainability over greed. ”
The European Commission proposes to amend the 2003 Energy Tax Directive to ensure that low-carbon energy is taxed at a lower rate than fossil fuels.
But since taxation is the exclusive prerogative of EU member states, each of whom has veto power, the proposal remains on hold.
Thierry Bros, a professor at Sciences Po University, told Euractiv that most of the extra profits made by energy companies are returned to shareholders, who have the potential to invest those profits in greener companies if they wish.
That's how capitalism works: shareholders have the right to vote with their dollars," he said.
According to Borås, a more effective way to change the behavior of oil companies is to implement carbon pricing policies more strictly.
"All those companies that make huge profits should pay all of their Tier 1 emissions taxes in the EU and the UK," Bross said. He insisted that no CO2 emission allowances should be issued to refineries.
"It's immoral and it's anti-climate," Bross said. He added that oil companies "shouldn't get any kind of subsidy for any green projects because they're rich enough."