While inflation is weighing on German consumers, energy companies are making good money from high oil and gas prices. As a comparison of quarterly profits compared to the previous year shows, corporations such as Shell and Total were able to rake in billions more. The demands for political consequences are getting louder again.
Europe’s energy companies are benefiting greatly from the high oil and gas prices resulting from the Ukraine war. British energy giant Shell quintupled its earnings to $18 billion in the April-June quarter. The French company TotalEnergies increased its profit by 158 percent from 2.2 billion to 5.7 billion dollars, the Spanish oil company Repsol increased its profit by more than double the previous year to 2.54 billion euros.
“Russia’s invasion of Ukraine continued to have an impact on energy markets, with oil prices averaging above $110 a barrel, refinery margins at record highs, gas prices sometimes higher than oil prices in Europe and Asia,” TotalEnergies said on Thursday. The group produced more and thus “contributed to energy security”. Repsol emphasized that the good results in the first half of the year help to offset the losses suffered in the Corona crisis.
In Germany, the energy group RWE revised its forecast for the current financial year sharply upwards on Wednesday evening – the company expects earnings before interest, taxes, depreciation and amortization of five to 5.5 billion euros instead of the previous 3.6 to four billion euros. RWE referred to an “extraordinarily good result” in electricity generation from water, biomass and gas as well as a “strong performance” in energy trading.
The figures from the corporations are likely to rekindle the debate about taxing the high profits made as a result of the war. In Germany, SPD leader Saskia Esken recently called for such an excess profit tax. It’s also a severe blow for consumers, as they pay significantly higher fuel prices than before the war of aggression – in addition to skyrocketing inflation and enormously increased gas prices.
In Spain, the government has announced such a tax on energy companies’ war-related profits for the coming year. The government wants to take in around two billion euros in 2023 and 2024. She wants to use the money to finance relief packages for the citizens. The trade associations criticize that the tax reduces the investment budget of the corporations.
