Oil companies “wringing humanity dry” for massive profits

Aug 07, 2022 News

…delaying energy transition – environmental activist

Kaieteur News – Oil companies are recording massive profits due to high oil prices stemming from the imbalance in the supply and demand chain. Stakeholders are nonetheless holding operators responsible for deliberately keeping production low while making “excessive and immoral profits” described by Secretary General of the United Nations (UN), António Guterres, when he called out fossil fuel companies for making the gains on the backs of vulnerable people.

Program Director at Stand.earth, Tzeporah Berman

Canadian environmentalist, Tzeporah Berman has also lashed out at big oil companies for “wringing humanity dry” in the process of making their hefty gains. In an opinion piece published in the UK Guardian, Berman accused oil companies of working against the transition to renewables and deliberately keeping production down, while making large sums of money off of the poor. Berman is the international programme director at Stand.earth and the chair of the Fossil Fuel Non-Proliferation Treaty Initiative.

She said that even as the climate crisis escalates, oil companies are recording huge profits and not accelerating an energy transition. She said that in the second quarter, oil companies have made 11-figure profits. “At the same time, inflation has reached 40-year highs around the world and recessions loom.” She said that “The obscene profits of the fossil fuel industry are jarring when set against the many households currently struggling to afford basic heating, cooling and food needs.” She continued that high energy prices are one of the leading factors driving inflation, and those prices are getting embedded into every facet of daily life, most obviously at the gas pump but also in delivery costs that affect everything from produce to paper towels.

“Meanwhile, ExxonMobil quadrupled last year’s figures with $17.85B. Shell beat its previous quarterly high with $11.5bn. Chevron rolled in with $11.62B in reported profit. This comes in the wake of new analysis last week that calculated $2.8B a day in pure profit for the oil and gas industry for the last 50 years.” Berman noted that while oil companies have tried to temper criticisms that their profits are at the expense of consumers, some companies have claimed to double their investment, but, “it is not being put toward renewable energy that would alleviate the global disruption the world sees today from high energy prices and decarbonise the energy grids, which are critical for meeting climate goals.”

“We need a rapid deployment of renewables,” the activist charged. She argued that solar and wind power technologies are already market-ready and cost-competitive. Even when taking into account environmental safeguards, land constraints and technical feasibility, solar and wind energy alone could power the world more than 50 times over, meeting the energy demands of every person in every region of the world.” Fossil fuel companies spend nearly $200 million a year lobbying to delay, control or block policies to tackle climate change, Berman informed.

She said that oil companies’ recorded profits are salt in the wound when it is seen that fossil fuel companies have successfully lobbied G20 governments for $151 billion within COVID-19 recovery packages on top of their profit, lobby transition delays and even seek assistance for carbon capture on its own projects. “We can’t rely on the fossil fuel industry to break business as usual, especially one that delivers unthinkable profits for the industry while the rest of us reel from the ripple effects of high fuel prices. That’s why there is an urgent need for a Fossil Fuel Non-Proliferation Treaty to end the expansion of oil, gas and coal, phase out existing production to limit warming to manageable levels and accelerate a fair energy transition where wealthy, fossil fuel-producing nations lead and support other countries so there is affordable, clean energy from sun, wind and water for everyone.”

The UN Chief has nonetheless urged governments to tax excessive profits from oil companies and use the funds to support the most vulnerable people through these difficult times. “I urge people everywhere to send a clear message to the fossil fuel industry and their financiers that this grotesque greed is punishing the poorest and most vulnerable people while destroying our only common home, the planet.” Guterres said many developing countries are drowning in debt without access to finance and are struggling to recover from the COVID-19 pandemic. Some situations are so dire that nations can go over the brink, the UN official warned. “We are already seeing the warning signs of a wave of economic, social and political upheaval that would leave no country untouched.” Guterres appealed to all global citizens that a firm stance be taken against fossil fuel companies as the current state of affairs is just reprehensible.

While other countries are set to introduce windfall taxes on oil companies, operators in the US currently face a 50 percent windfall tax on their mega-profits while a 25 percent is applied to energy firms in the UK. Trinidad and Tobago announced in February that it would be strengthening its legislative framework in an effort to net more gains made by oil companies during the energy crisis. Here in Guyana, leaders refuse to introduce the windfall tax, despite operators highlighting the Stabroek Block as a major contributor to their high quarterly earnings. The local government says it does not wish to affect the oil investment here.