Oil giant Shell profits nearly triple to £7.3 billion as fuel prices surge

Soaring earnings renew calls for windfall tax on oil and gas firms

Shell have announced soaring profits for the first months of the year (AFP via Getty Images)

Shell’s profits have nearly tripled to $9.1bn (£7.3bn) at the start of this year as energy prices soar amid the war in Ukraine.

The oil giant announced the record first quarter profits on Thursday, saying it had recorded “strong results in volatile times”.

The energy sector is reaping the benefits of rocketing oil and gas prices, which have been pushed to record levels by Russia’s invasion of Ukraine and surging demand as economies emerge from the Covid pandemic.

Shell’s new results come as calls mount in the UK for a windfall tax on fossil fuel giants to ease the cost of living crisis.

Ed Miliband, the shadow climate change secretary, said: “Another day, another oil and gas company making billions in profits, and yet another day when the government shamefully refuses to act with a windfall tax to bring down bills.”

Shell’s £7.3bn underlying earnings for the first three months of this year were better than expected and nearly three times higher than the $3.2bn (£2.6bn) reported in 2021.

Ben van Beurden, the company’s chief executive, said: “The war in Ukraine is first and foremost a human tragedy, but it has also caused significant disruption to global energy markets and has shown that secure, reliable and affordable energy simply cannot be taken for granted.

“The impacts of this uncertainty and the higher cost that comes with it are being felt far and wide. We have been engaging with governments, our customers and suppliers to work through the challenging implications and provide support and solutions where we can.”

The new figures showed Shell took a hit from its move to pull out of Russia over the Ukraine war, booking a $3.9bn (£3.1bn) charge.

Shell announced their first quarter results in the same week as oil and gas company BP recorded its highest underlying profits for more than a decade.

Environmental campaigners also called for a windfall tax after the soaring earnings were revealed.

“While giant fossil fuel firms like Shell post massive profits, millions of people are struggling with skyrocketing energy bills and living in heat-leaking homes,” Connor Schwartz, from Friends of the Earth, said.

“A tax on these excess profits could help pay for a nationwide free insulation programme, rolled out street by street, focusing on those most in need first.”

Meanwhile Philip Evans, a campaigner for Greenpeace UK, said: “By using a big chunk of the bloated profits that Shell, BP and others are raking in to make homes warmer, more energy efficient and kitted out with heat pumps, the government could start to really tackle the climate and cost of living crises simultaneously.”

Rishi Sunak, the chancellor, has so far resisted pressure to make the firms pay more tax, instead looking to encourage companies making big profits to invest the cash back into the UK.