British Oil MNC Shell has registered record annual profits after energy prices increased last year with the Russia-Ukraine war. With profits touching £32.2bn translating to $39.9bn for the year 2022, Shell’s profits doubled the last year’s figures and reached their peak in 115 year history
Following the eruption of the Russia-Ukraine war, energy firms have seen record earnings with the steady rise in oil and gas prices. The pressure on oil companies to pay more taxes has been rising as the common people are struggling with the rising prices. Several opposition parties highlighted the Shell profits as ‘outrageous’ and the government has been very lenient to the energy firms. The opposition also demanded an increase in the energy price cap that was long due in April be scrapped.
The energy prices began climbing from the end of the COVID-19 lockdowns, however, spiked up sharply in March impacted by the Russia-Ukraine war adding to the uncertainty of oil supplies. This has led to bumper profits for energy companies everywhere, and also triggered a rise in energy bills for domestic households and businesses.
Last year, the UK government introduced a windfall tax – called the Energy Profits Levy – on the “extraordinary” earnings of firms to help fund its scheme to lower gas and electricity bills.
To help fund its scheme to lower gas and electricity prices, the UK government introduced a windfall tax, Energy Profits Levy on the extraordinary earnings of oil firms. Shell had said it did not expect to pay any UK tax this year as it is allowed to offset decommissioning costs and investments in UK projects against any UK profits.
However, Shell itself confirmed its due of $134m in UK windfall tax for 2022 and is expected to pay more than $500m in 2023.