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BP ‘laughing all the way to the bank’ with bumper profits while households face poverty, say campaigners

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BP has revealed second-quarter profits more than trebled to a 14-year high (PA)
BP has revealed second-quarter profits more than trebled to a 14-year high (PA)

The government has been urged to raid massive profits at oil giants such as BP to provide additional help for families struggling to heat their homes – with average energy bills set to soar past £3,000 a year.

Climate campaigners said BP was “laughing all the way to the bank” while ordinary people are plunged into poverty after the oil and gas company posted profits of $8.5bn (£6.9bn) between April and June – the second-best quarter in its history.

The bumper earnings came off the back of a big jump in oil prices that has caused misery for British motorists faced with record prices at the pumps.

BP shareholders toasted a 10 per cent rise in their dividends, and also benefited from a boost to the share price which was up 4 per cent on Tuesday.

BP has committed some of its profits to buy back $3.5bn of the company’s shares in a move that will help support the company’s stock market valuation.

It came after rival fossil fuel companies Shell and Total reported record-breaking profits last week. British Gas owner Centrica, which supplies more than 9 million UK customers, also enjoyed a fivefold rise in its earnings.

The announcements have angered consumers who are being left to stomach higher energy bills and record prices at petrol station forecourts.

Households across Britain have been warned they could face an annual energy bill of £3,615 this winter in the latest analysis by Cornwall Insight. The energy consultancy said bills were on course to stay above £3,000 a year throughout 2023.

Labour heaped pressure on the government, urging ministers to cancel tax breaks on new fossil fuel extraction and use the money saved to help struggling households.

"People are worried sick about energy prices rising again in the autumn, but yet again we see eye-watering profits for oil and gas producers,” said the shadow chancellor Rachel Reeves.

"Labour argued for months for a windfall tax on these companies to help bring bills down, but when the Tories finally U-turned they decided to hand billions of pounds back to producers in tax breaks. That is totally wrong.

"It's clear people need greater protection from rising bills.”

Rishi Sunak caved to political pressure earlier this year, introducing a 5 per cent tax on oil companies’ “extraordinary profits” – but the levy did not come into force until 14 July meaning that it does not apply to profits made during the second quarter.

In a move heavily criticised by climate campaigners, the then chancellor also announced an 80 per cent tax break on oil companies’ new investments in the UK.

Doug Parr, chief scientist for Greenpeace UK, said: "While households are being plunged into poverty with knock-on impacts for the whole economy, fossil fuel companies are laughing all the way to the bank. The government is failing the UK and the climate in its hour of need.

"Government must bring in a proper windfall tax on these monster profits and stop giving companies massive tax breaks on destructive new fossil fuel investments.

"This could unlock billions of pounds to alleviate household bills and fund a nationwide rollout of home insulation which would keep bills low for good and get our UK fossil gas use under control."

BP chief executive Bernard Looney, who last year described oil companies as “cash machines”, said: "Today's results show that BP continues to perform while transforming.

"Our people have continued to work hard throughout the quarter helping to solve the ‘energy trilemma’ – secure, affordable and lower-carbon energy.”

The government has been approached for comment.

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