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FTSE 100: BP profits hit £23bn as energy crisis brings bumper gains

The BP logo is seen at a BP gas station in Manhattan, New York City, U.S., November 24, 2021. REUTERS/Andrew Kelly
Oil giant BP has made a big cut to the ambition of its climate change pledge. Photo: Andrew Kelly/Reuters (Andrew Kelly / reuters)

BP (BP.L) recorded a bumper profit of £23bn last year amid surging oil and gas prices as UK households are hit with soaring energy bills.

The company's profits more than doubled to $27.7bn (£23bn) in 2022, compared with $12.8bn the year before.

BP has also lifted its dividend by 10%, and announced a new $2.75bn share buyback programme on Tuesday morning.

Other energy firms have seen similar rises, with Shell (SHEL.L) reporting record earnings of nearly $40bn last week.


The figures will drive the debate on whether big oil and gas firms should be giving back more through windfall taxes amid the energy-driven cost of living crisis.

BP chief executive Bernard Looney said: “We are strengthening BP, with our strongest upstream plant reliability on record and our lowest production costs in 16 years, helping to generate strong returns and reducing debt for the 11th quarter in a row.

“Importantly, we are delivering for our shareholders – with buybacks and a growing dividend.

Read more: Digital pound: UK planning to launch ‘Britcoin’ for the crypto age

“This is exactly what we said we would do and will continue to do – performing while transforming.”

The company said that it would invest an additional £6.6bn each in the energy transition, and in oil and gas.

However, the oil major has made a big cut to the ambition of its climate change pledge.

The business said it expects the carbon emissions form its oil and gas production will fall by between 20-30% by 2030, when compared to 2019. Its previous target had been a 35-40% drop in emissions.

It comes as the business said that its oil and gas production will be around two million barrels of oil equivalent a day in 2030. This is 25% lower than in in 2019, but its previous plan had been to cut production by 40%.

Shadow climate secretary Ed Miliband called on the government to bring forward a “proper” windfall tax on energy companies.

The Labour MP said: “It’s yet another day of enormous profits at an energy giant, the windfalls of war, coming out of the pockets of the British people.

“What is outrageous is that as energy giants rake in these sums, Rishi Sunak still refuses to bring in a proper windfall tax.

“This is why people are sick and tired of the way the country is run under the Tories.

“In just eight weeks time, the government plans to allow the energy price cap to rise to £3,000. Labour would use a proper windfall tax to stop prices going up in April.”

BP shares are up 3.96% at 496p, making it the top riser on the FTSE 100 index of blue-chip shares.

TUC general secretary Paul Nowak, said: “As millions struggle to heat their homes and put food on the table, BP are laughing all the way to the bank.

“Hard-pressed families will rightly feel furious – they are being treated like cash machines.

“This boils down to political choices.

“Ministers are letting big oil and gas companies pocket billions in excess profits. But they are refusing to give nurses, teachers and other key workers a decent pay rise.

“We need a government on the side of working people, not fat cat energy producers.

“That means imposing a higher windfall tax on the likes of BP and Shell. It means giving public servants fair pay. And it means giving households extra financial support as bills rise this April.”

Read more: Shell delivers record $40bn annual profit as energy prices soar

Greenpeace UK’s head of climate justice, Kate Blagojevic, said: “BP is yet another fossil fuel giant mining gold out of the vast suffering caused by the climate and energy crisis.

“What’s worse, their green plans seem to have been strongly undermined by pressure from investors and governments to make even more dirty money out of oil and gas.

“This is precisely why we need governments to intervene to change the rules.”

She added: “It’s time to stop drilling and start making polluters, not communities, who did least to cause the problem, pay the price for the climate damage they are causing all around the world.”

Shareholders have been further rewarded through share buybacks. BP said it would repurchase $2.75bn of shares over the next three months after buying $11.7bn in 2022.

Joshua Warner, market analyst at City Index said: “Shareholders will welcome the $2.75bn share buyback considering this was significantly larger than expected, as well as the 10% dividend increase.”

“Those increased returns came after BP generated significantly more cash than anticipated, allowing it to spray investors with cash and reduce its net debt for an eleventh consecutive quarter.”

Watch: BP announces record annual profits of £23bn

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