BP’s annual profit more than doubled to $28 billion

Hong Kong/London
CNN
—

BP’s annual profit more than doubled last year to a record high of nearly $28 billion, extending a record streak of profits for the global oil majors that fuel calls for higher taxes on windfall gains.

The British energy giant said in a statement that underlying replacement cost profit rose to $27.7 billion in 2022 from $12.8 billion the previous year. The metric is a key indicator of the profitability of oil companies.

BP (BP) also announced a new $2.75 billion share buyback on Tuesday and raised its fourth-quarter dividend by about 10% to 6.61 cents per share.

Profits topped the company’s previous annual record of $26.3 billion, set in 2008.

Shares of BP rose 5.2% in morning trading after the news. Over the past 12 months, its shares have soared 23%.

The winnings are the latest in a series record results of the world’s largest energy companies, which have made windfall profits thanks to the soaring oil and gas prices.

Last week, Shell (RDSA) reported record earnings of nearly $40 billion for 2022, more than double what it raked in the year before after oil and gas prices soared. following Russia’s invasion of Ukraine.

The effect of the war on British households has been a spike in energy costs, with the average gas and electricity bill set to rise again from early April.

The companies’ stunning results have amplified calls for the UK government to impose exceptional taxes on energy companies.

Last year Prime Minister Rishi Sunak – then finance minister – introduced a 25% tax on profits from oil and gas extraction in the North Sea. Last month, the government increased this tax, called the energy profit levy, to 35% and extended it until March 2028.

BP told CNN it plans to pay $2.2 billion in UK tax for 2022, including $700 million related to the UK Energy Profits Tax.

Nick Butler, a former BP executive, told BBC Radio on Tuesday that the company makes most of its profits outside the UK.

“I’m sure there will be more pressure for windfall taxes…I think people should be aware that this is a temporary situation. Oil and gas prices are falling,” he said.

Butler added that the company was “rebalancing its strategy a bit to invest a little longer in oil and gas, and at a higher level, as well as in renewables.”

— Hanna Ziady contributed reporting.