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Oil major BP revenue Q2 2022

A BP gas station in Madrid, Spain.

Sopa pictures | Lightrocket | Getty Images

LONDON — British oil giant BP reported big second-quarter profits on Tuesday, benefiting from a rise in commodity prices.

The British energy major posted second-quarter underlying replacement cost results, used as a proxy for net profit, of $8.5 billion.

That compared with a profit of $6.2 billion in the first three months of the year and $2.8 billion for the second quarter of 2021[ads1]. Analysts had expected BP to report a first-quarter profit of $6.3 billion, according to Refinitiv.

BP also announced on Tuesday a 10% increase in its quarterly dividend payout to shareholders, raising it to 6.006 cents per ordinary share.

Shares in BP have risen almost 20% so far this year.

BP’s results once again underline the stark contrast between Big Oil’s profit bonanza and those struggling with an ever-deepening cost-of-living crisis.

The world’s largest oil and gas companies have broken profit records in recent months, following a rise in commodity prices as a result of Russia’s invasion of Ukraine.

For many fossil fuel companies, the immediate priority appears to be returning cash to shareholders via buyback programs.

Last week, BP’s British rival Shell reported record second-quarter results of $11.5 billion and announced a $6 billion share buyback program, while British Gas owner Centrica reinstated its dividend after a massive first-half increase.

Cost of living crisis

Environmentalists and unions have condemned Big Oil’s rising profits and called on the UK government to introduce meaningful measures to bring down the cost of rising energy bills.

Last month, a cross-party group of UK lawmakers called on the government to increase the level of support to help households pay rising energy bills and outline a nationwide plan to insulate homes.

A price cap on the most used energy tariffs for consumers is expected to rise by more than 60% in October due to rising gas prices, taking the average household’s annual dual fuel bills to more than £3,200 ($3,845).

Fuel poverty charity National Energy Action has warned that if this happens, it will push 8.2 million homes – or one in three UK homes – into energy poverty. Fuel or energy poverty refers to when a household cannot afford to heat their home to an adequate temperature.

“It’s clear that not everyone is struggling with the energy crisis,” Sana Yusuf, energy campaigner at Friends of the Earth, said in reaction to Shell and Centrica’s results. “These bumper profits will be met with disbelief by millions of people across the UK who face high energy prices.”

Yusuf called on the UK government to introduce a tougher windfall tax on energy companies. “The bulk of these profits should be used to insulate our homes and help cash-strapped households pay for their heating this winter, rather than developing more fossil fuel projects that are frying the planet,” Yusuf said.

Burning fossil fuels, such as oil and gas, is the main driver of the climate crisis, and scientists have found that fossil fuel production remains “dangerously out of sync” with global climate targets.

UN Secretary-General Antonio Guterres, speaking in June, called for an end to fossil fuel funding, describing new funding for fossil fuel exploration as “delusional”.

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