BP Posts $8.2 Billion In Quarterly Profit As Oil Giants Post Bumper Earnings

The world’s largest oil and gas company, BP on Tuesday, announced third-quarter profits that were higher than anticipated because of high commodity prices and active gas marketing and trading.

The British energy giant reported an underlying replacement cost profit of $8.2 billion for the three months ending in September, which is used as a stand-in for net profit. That was significantly more than the net profit of $3.3 billion recorded a year earlier, which was $8.5 billion in the prior quarter.

Refinitiv’s poll of analysts had predicted a net profit of $6 billion for the third quarter. BP reported net debt was down to $22 billion from $22.8 billion in the second quarter and announced an additional $2.5 billion in share repurchases.

BP posts $8.2 billion in quarterly
BP posts $8.2 billion in quarterly

It recorded a $2.2 billion financial loss for the period, down from a $9.3 billion profit the prior quarter. According to BP, this third-quarter result includes a charge for adjusting items net of tax of $8.1 billion as well as inventory holding losses net of tax of $2.2 billion.

The biggest oil and gas companies in the world have just declared record profits because of rising commodity prices as a result of Russia’s invasion of Ukraine.

Oil giants Shell, TotalEnergies, Exxon, and Chevron have reported third-quarter profits totaling close to $50 billion when combined with BP. This has led to new calls for more taxes to be levied on record oil company profits, especially at a time when rising gasoline and gas costs have increased inflation globally.

The U.S. On Monday, President Joe Biden urged oil companies to stop “war profiteering” and warned to increase taxes if they did not take action to lower petrol costs.

Groups representing the oil and gas industries have previously opposed suggestions for a windfall tax, stating that it would do nothing to stop a sudden increase in energy prices and might even discourage investment.

According to BP CEO Bernard Looney, “this quarter’s results demonstrate us continuing to succeed while evolving.”

“We continue to be committed to assisting in the development of secure, cheap, and low-carbon energy solutions. We are supplying the oil and gas that the world requires right now while also making investments to hasten the energy transition,” Looney said.

During morning trading, shares of the London-listed BP increased by about 1%. The company’s stock price has been up more than 45% so far this year.

Windfall Tax ‘Now A Necessity

Environmental campaign organizations referred to BP’s third-quarter results as “a slap in the face” for the millions of Britons experiencing a worsening cost-of-living crisis and claimed they demonstrated the necessity for a windfall tax.

The need for a larger, more audacious windfall tax is now clear-cut, according to Sana Yusuf, Friends of the Earth’s energy campaigner. “This has to close the ludicrous loophole that allows businesses to pay the bare minimum if they invest in new gas and oil projects that contribute to global warming.”

A street-by-street home insulation program should be funded with some of the billions of pounds raised, according to Yusuf, to lower energy costs and curb emissions. The main cause of climate catastrophe is the use of fossil fuels like coal, oil, and gas.

According to Jonathan Noronha-Gant, senior fossil fuels campaigner at Global Witness, “a real windfall tax on the profits of big polluters is no longer a distant cry, it is now a need.”

However, the new U.K. To permanently address this flawed energy system, the government must swiftly put us on track for a quick shift away from filthy fossil fuels and toward renewable energy sources and adequate house insulation.

Our Job Is To ‘pay Our Taxes’

On a panel moderated by CNBC, BP CEO Bernard Looney said that he understood the public’s interest in the oil majors’ record profits, but he sought to defend the company’s track record when it comes to investing and paying taxes. Looney was speaking at the ADIPEC conference in the United Arab Emirates on Monday.

The U.K., Europe, and the rest of the world are in for a very challenging winter, according to Looney.

“Our job is to invest; our job is to pay our taxes. That’s what our job is, and we just announced a $4 billion acquisition of renewable natural gas in the United States last week. We’ll keep doing that and doing our absolute best,” he continued.

Conclusion

Strong natural gas trade helped BP more than double its third-quarter profit from a year earlier to $8.15 billion, and it increased share repurchases by $2.5 billion amid growing calls for higher taxation on the oil industry.

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