Shell reports highest profits in company’s 115-year history (2024)

Shell has reported its highest profits in its 115-year history.

The oil and gas giant’s profits hit a record $39.9 billion (€36 billion) in 2022 - double the total for 2021.

Shell’s earnings continue to set the trend for record profits from the world’s biggest energy companies last year. They have benefited from high prices as countries move away from Russian gas due to the war in Ukraine.

The majority of the fossil fuel giant’s profits came from its gas operations.

Calls for windfall taxes to be increased

Energy firms have been facing increasing pressure to pay more tax as oil and gas prices surge.

In September, EU countries passed emergency legislation which included a 33 per cent tax on fossil fuel companies that exceeded their four-year profit average by 20 per cent.

The UK government also introduced a windfall tax on these “extraordinary” profits to fund schemes to help reduce gas and electricity bills.

Shell confirmed on Thursday (2 February) that it had paid $1.9 billion (€1.7 billion) in charges related to windfall taxes in the UK and EU. It says it is due to pay $134 million (€122 million) in the UK for 2022 and expects to pay more than $500 million (€455 million) in 2023.

But record profits from energy companies have only furthered calls for windfall taxes to be increased.

UK Liberal Democrat Party leader Ed Davey said “No company should be making these kinds of outrageous profits out of Putin’s illegal invasion of Ukraine.”

He called for the government to “tax oil and gas companies properly”.

Shell faces greenwashing complaint in the US

News of record profits comes as Global Witness launches a greenwashing complaint with the US financial regulator against Shell.

It says that the energy company is misleading US authorities, investors and the public by labelling fossil fuels as ‘renewable’.

In 2021, Shell said that it aims to spend between $2 billion (€1.8 billion) and $3 billion (€2.7 billion) a year on renewables and energy solutions.

Global Witness analysed investments Shell labels as ‘renewable and energy solutions’ and found that just 1.5 per cent of its total expenditure went towards wind and solar power generation.

The analysis also found widespread use of fossil gas across its renewable spending.

In its complaint to the financial regulator, the activist group says it is “concerned that Shell has materially misstated its financial commitment to renewable sources of energy”.

“Shell’s so-called renewable and energy solutions category is pure fiction,” says Zorka Milin, senior advisor at Global Witness.

“Overstating investments in renewables and misleading the public is pure greenwashing. Climate action cannot be dreamed up in marketing departments, instead it must underpin the concrete activity of the company as a whole.”

Shell has responded to the complaint, saying it is “confident that its financial disclosures are fully compliant with all SEC and other reporting requirements”.