Shell’s Record Profits Spark Outrage Amid Energy Crisis

Shell has been accused of a “profiteering bonanza” after it made record first-quarter profits of more than $9.6bn (£7.6bn) and showered shareholders with more than $6bn, even as oil and gas prices tumbled from last year’s highs.

The better than expected profits in the first three months of this year were well above the $7.96bn predicted by industry analysts, and topped Shell’s previous first-quarter record set last year at $9.1bn for the same period.

Europe’s biggest oil and gas company handed shareholders $2bn in dividend payments and bought back shares worth $4.3bn over the last quarter, and plans to offer its investors another $4bn in share buybacks over the next three months.

Shell’s bumper profits emerged two days after its smaller rival BP reported a profit of $4.96bn for the first quarter, down from $6.2bn in the same period last year, but well above the $4.3bn expected by analysts.

Both firms were criticised by unions and environmentalists for their “profiteering plundering” at a time when millions of households are struggling with soaring energy bills and facing a cost-of-living crisis.

Sharon Graham, the general secretary of the Unite union, said: “The scale of profiteering displayed today by Shell and earlier this week BP is one of the corporate scandals of our times. And this is practically untouched by Rishi Sunak’s so-called windfall tax.”

Charlie Kronick, of Greenpeace UK, said: “As temperatures soar from Madrid to Mogadishu, Shell is once again posting bumper profits while promising to keep extracting fossil fuels for years to come.”

The UK government introduced a windfall energy profits levy in May last year to raise £1.5bn from oil and gas companies over three years. The levy was increased from January this year to raise another £1.5bn.

Shell said it paid higher taxes, reaching over $3bn globally for the last quarter. Its UK tax bill hit $134m last year after the windfall energy profits levy was introduced in May. Shell expects to pay more than $500m to the Treasury this year after the levy was increased from January.

Shell said its profits increased despite higher taxes and lower sums paid on the market for the oil and gas it produces, thanks in part to its energy trading teams managing to mitigate against falling prices.

Global oil prices averaged $81.7 a barrel in the first quarter of this year, according to Shell,down from $102.2 a barrel in the same period a year earlier, when Russia’s invasion of Ukraine ignited a surge in oil and gas markets.

Reference：

• Shell accused of ‘profiteering bonanza’ after record first-quarter profits of $9.6bn | The Guardian | 4 May 2023
• Fury as Shell rakes in record $9.6billion first quarter ‘profit bonanza’ | The Independent | 4 May 2023
• Shell’s record profits spark calls for tougher windfall tax | BBC News | 5 May 2023