Analysis from the think tank Common Wealth finds BP reported profits of £2 billion ($2.6 billion) in its Q2 2023 results, while CEO Bernard Looney's salary doubled last year to £10million. Shareholder payouts totalled $3.3 bn (£2.5 bn), comprised of $2.1 bn (£1.6 bn) in share buybacks and $1.2 bn (£940 million) in dividends. The oil and gas giant also announced a new share buyback programme of $1.5 bn (£1.17 bn) to be paid in Q3.  

The analysis adds to the mounting evidence that despite its climate-friendly rhetoric, BP is doubling down on fossil fuels as the climate crisis intensifies. The new figures show BP's investment in “Low Carbon” segments pales relative to its investment in fossil fuels and what it pays out to its shareholders. In Q2,Common Wealth analyst Sophie Flinders found BP invested eleven times as much in fossil fuels ($2.2bn) as in its “Low Carbon” segment ($190m). BP’s “Low Carbon” segment includes a range of investments including renewables, hydrogen and carbon capture. In total, BP has paid shareholders $101.6bn since 2010. 

Last week, Common Wealth analysis found Shell invested 5.6 times as much in fossil fuel production as its "Low Carbon" segments. The analysis also found Shell has handed $184.67 bn to shareholders since 2010, a vast transfer of wealth from households to Shell’s shareholders. Between them, Shell and BP have handed$286.3 bn to shareholders since 2010.

They are not the only energy giants to be profiting from a cost of living crisis while “boiling” the planet. Centrica, the company that owns British Gas, posted record results last week. For the first six months of 2023, the energy giant posted historic profits of £2.1bn (compared to £1.3bn for the first half of2022). British Gas itself has made a record profit of £969m for the first six months of 2023, an increase of almost 900%.  

On Monday, the government re-announced plans to issue 100 new fossil fuel exploration licenses in the North Sea. However, according to the campaign group Uplift, an estimated 80% of North Sea oil is exported overseas, highlighting the limited domestic benefits of the government's policy. Previous Common Wealth analysis has also highlighted the growth of private equity-backed firms and overseas state-owned entities in North Sea oil and gas, with countries like the UAE and China present in the North Sea, among others.  

The surge in profits and shareholder payouts from fossil fuel giants amidst an energy-driven cost of living crisis raises critical questions about the structure and role of the for-profit corporation in driving a secure and fair transition to a clean energy future. 

[.quote][.quote-text]BP remains a cash machine for investors, at the expense of households, the planet and our long-term energy security. This is more than just a story of 'big, greedy corporations'. As they invest over 11 times as much in in oil and gas as 'low carbon’ and distribute 17 times as much to shareholders as renewables, it is clear is a fatal tension between the shareholder-owned, profit maximising corporation and our social, ecological and economic priorities. The need to maximise returns for investors above other priorities significantly slows the pace of decarbonisation, and has left us dependent on volatile and expensive oil and gas. Reckoning with this fact is necessary to confront the cost of living crisis and to stop the planet boiling.[.quote-text][.quotee]Mathew Lawrence, Director at Common Wealth[.quotee][.quote]

[.quote][.quote-text]BP has handed shareholders payouts of $1.2 bn in dividends and $2.1bn in share buybacks in this quarter alone. In the last two years, their CEO has seen pay rise by 5.7 times, to $12 million. There’s too much money to be made in fossil fuels to place the responsibility of decarbonising energy on oil giants like BP and Shell. These windfall profits have not translated into an increase in low carbon investment. We are kidding ourselves if we think that the oil giants will pave the way for future where our planet is habitable. Most governments have been too slow or unwilling to tax these windfall profits and mitigate against the cost of living crisis. Deadly heat waves in America, wildfires across the Mediterranean and floods in the Philippines and Pakistan show that the crisis is already upon us — and that Big Oil needs to be consigned to the dustbin of history. Shareholders are lining their pockets at the cost of a habitable climate. Clear, ambitious political interventions are needed to decarbonise energy and avert the worst of the climate crisis.[.quote-text][.quotee]Sophie Flinders, Data Analyst at Common Wealth[.quotee][.quote]