Shell posts record profits of £32.2bn after oil prices surge in wake of Russia's invasion of Ukraine

2 February 2023, 07:24 | Updated: 2 February 2023, 08:21

Shell posted record profits
Shell posted record profits. Picture: Alamy

By Will Taylor

Energy giant Shell has posted record profits thanks to soaring oil prices following Russia's invasion of Ukraine.

In an announcement likely to provoke anger from Brits struggling to pay eye-watering bills, the business announced profits doubled to £32.2bn.

That is one of the largest profits ever posted by a British company, ranking behind huge takes like Vodafone's £60bn when it sold Verizon Wireless in 2014 and British American Tobacco's posting of £38bn in 2017.

It has led again to renewed calls for a windfall tax on energy firms that have done well out of surging prices driven by the war.

Shell chief executive Wael Sawan said: "Our results in Q4 and across the full year demonstrate the strength of Shell's differentiated portfolio, as well as our capacity to deliver vital energy to our customers in a volatile world.

"We believe that Shell is well positioned to be the trusted partner through the energy transition.

"As we continue to put our Powering Progress strategy into action, we will build on our core strengths, further simplify the organisation and focus on performance.

Read more: Fury as British Gas debt collectors force their way into vulnerable people's homes to install prepayment meters

Shell has posted record profits after surging oil prices
Shell has posted record profits after surging oil prices. Picture: Alamy

"We intend to remain disciplined while delivering compelling shareholder returns, as demonstrated by the 15% dividend increase and the four-billion-dollar share buyback programme announced today."

Labour's shadow climate change secretary Ed Miliband said: "As the British people face an energy price hike of 40% in April, the Government is letting the fossil fuel companies making bumper profits off the hook with their refusal to implement a proper windfall tax.

"Labour would stop the energy price cap going up in April, because it is only right that the companies making unexpected windfall profits from the proceeds of war pay their fair share.

"But when it comes to oil and gas interests, Rishi Sunak is too weak to stand up for the British people."

The Government introduced the Energy Profits Levy last year as a way of funding its support to lower energy bills.

Lib Dem leader Sir Ed Davey said: "No company should be making these kind of outrageous profits out of Putin's illegal invasion of Ukraine.

"Rishi Sunak was warned as chancellor and now as Prime Minister that we need a proper windfall tax on companies like Shell and he has failed to take action.

Read more: Households will see largest increase to water bills in almost 20 years from April when they soar to £448 a year

"Families across the country are struggling to heat their homes and feed their families and this Government turns round and says 'there is nothing we can do'.

"They must tax the oil and gas companies properly and at the very least ensure that energy bills don't rise yet again in April."

Oil and gas prices were already rising after Covid lockdowns eased but they were worsened by Russia's invasion of Ukraine.

Brent crude oil rose about $120 a barrel in March last year, just days after Putin launched his failed attempt to take over the country, but oil prices are now lower than before the invasion.

Gas remains expensive, which prompted the Government to introduce support to help keep energy bills down.

Greenpeace appeared outside its headquarters in London after the profits were announced, with a mock up oil price board showing the company's earnings.

Senior UK campaigner Elena Polisano said: "While Shell counts their record-breaking billions, people across the globe count the damage from the record-breaking droughts, heatwaves and floods this oil giant is fueling.

"This is the stark reality of climate injustice, and we must end it.

"World leaders have just set up a new fund to pay for the loss and damage caused by the climate crisis. Now they should force historical mega polluters like Shell to pay into it."

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