AS it becomes clear that Russia’s war on Ukraine could last for many months, oil and gas giants may be about to help breathe new life into the debate about whether a windfall tax should be imposed on North Sea firms.

Rishi Sunak came under intense pressure to impose such a tax in his Spring Statement after it became clear to some that the arguments in favour of one had real force.

Results from BP and Shell this week are expected to provide further evidence of the exceptional boost to profitability that firms have enjoyed following the surge in commodity prices fuelled by the recovery from the pandemic.

READ MORE: Shell to pay billions to investors after Cambo U-turn

The rise left millions of consumers face swingeing increases in their energy bills even before the fallout from the awful events in Ukraine sent oil and gas prices to multi-year highs. While prices have eased following China’s decision to imposed more Covid-19 lockdowns, the expectation is they will remain at much higher levels than oil and gas firms were planning for.

After slashing costs and shedding hundreds of jobs amid the last downturn, BP and Shell are set to make massive profits in the North Sea this year.

HeraldScotland: The Chancellor of the Exchequer Rishi Sunak pictured with his wife Akshata Murty Ian West PA WireThe Chancellor of the Exchequer Rishi Sunak pictured with his wife Akshata Murty Ian West PA Wire

While Mr Sunak was happy to go ahead with National Insurance rate increases that will add to the pressure on households and firms, he decided not to impose a windfall tax after industry leaders insisted such a levy would deter firms from investing in the North Sea. BP’s chief executive Bernard Looney and Shall boss Ben van Beurden have echoed those claims.

They can say that developments in Ukraine have reinforced the arguments for making the most of the North Sea’s reserves. The UK needs to reduce its reliance on imports, which may entail higher emissions.

Similar points were made to Boris Johnson at a meeting he held with industry leaders before the Westminster Government published its Energy Security strategy in April. In the strategy it said the country needed to give the energy fields of the North Sea a new lease of life.

But, after maintaining a windfall tax would not make sense, Rishi Sunak signalled last week that he could reconsider. In a Q&A on the mumsnet website, Mr Sunak said he would look at a windfall tax if firms did not make the investments expected in the UK’s energy security.

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Business minister Kwasi Kwarteng was adamant at the weekend that there would be no volte face in terms of a windfall tax. However, the Chancellor needs to act fast to restore the lustre of the Rishi Sunak brand, which has faded amid criticism of his response to the cost of living crisis and of his wealthy wife’s non-dom tax status.

BP and Shell could cause fresh complications when they announce first quarter results this week.

BP is expected to post a $4.5bn replacement cost profit for the three months to March 31 today. It made $3.3bn in the same period last year. The company made $4.7bn annual profit in 2021after losing $18.1bn in 2020, during which the pandemic triggered a deep slump.

Shell is expected to make $8.7bn adjusted earnings, against $3.2bn last time.

If confirmed, the results announcements will be seized on by champions of a windfall tax.

HeraldScotland: BP chief executive Bernard Looney Picture: BP BP chief executive Bernard Looney Picture: BP

Against that backdrop the two giants might be able to help themselves by providing clear evidence that they are making investments on an appropriate scale in the UK.

Both have bandied around big numbers in that respect.

Shell has said it plans to invest up to £25 billion in the UK’s energy system over the next decade with the bulk of that ear-marked for low and no-carbon services.

BP has said that for every £1 it makes in the UK this decade it plans to spend £2 “including investments to help the UK to net zero”.

Last week the company underlined how much it expects to invest in Scotland in support of its drive to develop a big windpower business off the country.

BP and Shell bid successfully for acreage in the landmark ScotWind round, with Germany’s EnBW and with ScottishPower respectively.

READ MORE: Oil giants hail ScotWind success amid claims huge boost to supply chain in prospect

After Crown Estate Scotland last week highlighted the potential economic impact of ScotWind projects, BP said it had a long track record of investing in Scotland and building successful supply chains.

Offshore wind project director Richard Haydock said: “With our partner EnBW, our ScotWind supply chain development statement affirms our continued commitment to Scotland with at least £1.2bn of spend, investing in Scottish ports, shipbuilding and skills, creating an estimated 1,000 direct and indirect jobs.

“Our ambition is to go further than this and that’s why we’re engaging with the Scottish supply chain, education providers and the community to support Scotland’s just transition.”

But this kind of talk may sound familiar to some. The benefits associated with ScotWind may not be delivered for years.

HeraldScotland: Shell chief executive Ben van Beurden Picture: ShellShell chief executive Ben van Beurden Picture: Shell

BP and Shell could take some pressure off themselves by making it clear that they plan to invest in North Sea oil and gas projects that could provide a boost to production and the wider economy in the relatively short term.

After putting plans for the huge Cambo development off Shetland on hold in December, partly for economic reasons, Shell will be expected to update on the future of the project on Thursday.

Israeli-owned Ithaca Energy recently bought into Cambo and made clear it saw huge potential in the field.

READ MORE: Shetland oil pioneer eyes acqusitions after year of 'profound change'

But any statement by Shell or BP that appeared to signal commitment to a development like Cambo would risk the ire of environmental campaigners. These made the most noise in the energy debate in the run up the COP26 climate summit in Glasgow.

Some are trying to turn the volume up even higher. For example, the Just Stop Oil coalition claimed last month that petrol pumps had run dry across the Midlands and South East of England as its supporters disrupted supplies from critical oil terminals. Just Stop Oil is backed by the US-based Climate Emergency Fund. The founding donors of CEF include Aileen Getty, grand-daughter of US oil tycoon Jean Paul Getty.