Energy giants have been routinely pilloried since they began to see a profits surge in the wake of Russia’s invasion of Ukraine in February 2022.
Companies such BP, Shell and Centrica have found themselves in the cross hairs of trade unions and anti-poverty groups for banking billions of pounds of profits as they benefited from the surge in commodity prices which followed the start of hostilities, while people have been struggling amid the worst cost of living crisis in the UK in decades.
Even though these businesses have no control over the price at which the commodities they sell are traded at, it has certainly not been a good look to be posting near-record earnings at a time when some in society have been unable to afford to heat their own homes.
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Gas prices have steadily fallen since their post Ukraine invasion peak around the middle of 2022, but still the distaste lingers. Against the backdrop of falling gas prices last year, both BP and Shell saw profits fall in 2023, albeit their performances were better than analysts expected. But still the criticism continues.
That is partly because the profits they are making remain huge at a time when households are still mired in the cost of living crisis, with the UK having fallen into recession in the second half of last year. It also because the likes of BP and Shell are making so much money they can afford to return billions of pounds to shareholders in dividends and buybacks.
Moreover, the sentiment towards these companies will certainly not mellow in light of the annual report published by BP today, which revealed chief executive Murray Auchincloss was paid more than £8m last year, including £6.5m of bonuses.
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For Alice Harrison of campaign group Global Witness, it is proof that the millions paid to Mr Auchincloss shows the “sickening reality of our broken energy system” and that the windfall tax on oil and gas profits introduced by the UK Government in May 2022 is not stringent enough.
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