While Europe is still struggling, the United States weathered the first bout of oil and gas increases, got slammed in December/January on natural gas heating costs, which seemed to double and triple overnight. Prices at the pump came down on this side of the Atlantic but seem to be creeping up again slowly. As Vladimir Putin amps up his no-win war against Ukraine. So, you might ask yourself who exactly makes all the money when those price hit the roof. Duh. Energy extractors everywhere. And I do mean everywhere. Here are just two examples, reflective of the rest, sanctions and price caps notwithstanding. Shell reported profits of $39.9bn in 2022, the highest in its 115-year history. BP generated profits of $27.7bn in the same year, more than double what they generated in 2021.
It is so gratifying to make money on the suffering of others, but for the oil and gas industry, it is a cherished tradition. Reports that Exxon/Mobil was fully aware – better versed with scientific facts than the US government in the 1970s – that burning of fossil fuels was causing climate change, which was going to accelerate if not stopped. Very much including gasoline, kerosine and diesel-powered vehicles, ships and aircraft. They kept the information to themselves, spent decades and hundreds of millions of dollars challenging all the government and academic research that later established the connection between fossil fuels and climate change. The truth was revealed recently when Exxon/Mobil’s internal research was discovered and released to the public. See also my February 7th Case Study: Why Industry Self-Regulation Almost Never Works blog for more details.
The February 2nd BBC.com noted that Shell Oil was symptomatic of oil company greed: “The price of Brent crude oil reached nearly $128 a barrel following the invasion, but has since fallen back to about $83. Gas prices also spiked but have come down from their highs… It has led to bumper profits for energy companies, but also fueled a rise in energy bills for 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… Despite the move, 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.” Parallel windfall taxes have been proposed in various states and by the federal government. Naturally, despite the suffering of Americans forced to fund these unholy increases in profits, Republicans have no issue with the privileged or accelerated write-offs for the oil and gas industry, but they do not want to take these behemoths to pay their fair share of taxes on the windfall.
It is equally clear that BIG OIL (and gas) have put all environmental concerns on a back burner to maximize their extraction of these fossil fuels at a time when people are being forced to pay the most. Any accommodation to greenhouse emissions and pollution limits are now a matter of pledges for future years! The February 7th BBC.com looks at BP specifically, but this is the actual response of all the major oil and gas extraction mega-companies: “BP boss Bernard Looney said the British company was ‘helping provide the energy the world needs’ while investing the transition to green energy… But it came as the firm scaled back plans to cut carbon emissions by reducing its oil and gas output.
“The company - which was one of the first oil and gas giants to announce an ambition to cut emissions to net zero by 2050 - had previously promised that emissions would be 35-40% lower by the end of this decade… However, on Tuesday [2/7] it said it was now targeting a 20-30% cut, saying it needed to keep investing in oil and gas to meet current demands.
“Climate campaign group Greenpeace, whose voice the BBC has included because of the impact of oil and gas production on the environment, said BP's new strategy ‘seems to have been strongly undermined by pressure from investors and governments to make even more dirty money out of oil and gas’… Energy prices had begun to climb following the end of Covid lockdowns but rose sharply in March last year after Russia invaded Ukraine, sparking concerns about global supplies.”
I guess their fingers were crossed behind their backs when they made the pledge. Nature does not care if there is more money to be made by ignoring physical realities. BIG OIL has always known what they were doing was causing massive changes to our daily lives. Long before governments came to that conclusion. But when BIG MONEY is to be made by BIG OIL, anything that stands in their way has got to go. At the very least, the governments that are saddled with responding to the disasters climate change has already caused should be entitled to impose massive windfall taxes on the perpetrators.
I’m Peter Dekom, and I wonder where the BIG OIL executives will be after the next spate of cyclones and hurricanes, raging wildfires, killer crop failures, intolerable heat waves, unprecedented flooding elsewhere and coastal erosion that will redefine all nations with major urban areas on or near an ocean.
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