As energy prices are set to rise again, Shell plans to hand £6bn to shareholders

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As oil and gas prices soar across the UK and Europe, energy giant Shell has been raking it in. It managed to increase its profits a staggering fourteen-fold. As prices surged, one of its organisations (the upstream unit) was able to collect 8.88 dollars for every thousand cubic feet of gas it sold to customers over the last quarter of 2021.

Energy price rises have contributed to soaring inflation, led to energy suppliers going out of business and from 1 April households will be hit with a hike in energy bills of hundreds of pounds:

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We’re not getting the full story

MPs Caroline Lucas and Clive Lewis explained why they believe energy prices are increasing and how the government is “lying to us”. According to Lucas:

A group of Tory MPs and their mates in the right wing media are lying to us about why it’s costing us so much to heat our homes this winter

Lewis said energy price increases were increasing again:

so a handful of shareholders can make yet more profit

Nothing new but shocking increases

But as independent journalist Alex Tiffin pointed out, energy price hikes aren’t new. They’ve been affecting the poorest people in society for some time:

While the Jim Pickard of the Financial Times predicted what the increase would be for millions of people:

More than doubled in price

Just six months earlier gas had been selling for 4.31 dollars, less than half of its most recent level. And Shell’s CEO seems to think this is cause for celebration:

And while some try to blame the price increase on the use of renewable energy, New Scientist journalist Adam Vaughan rubbished those claims:

Shell rakes it in

But for Shell the rises in gas prices, and an 18% spike in the price at which its upstream business sold oil, helped propel it to a 16.3 billion US dollar (£12 billion) pre-tax profit in the fourth quarter of last year, compared with just 1.2 billion dollars (£885.5 million) in the third quarter.

Chief executive Ben van Beurden said:

We delivered a very strong financial performance in 2021, and our financial strength and discipline underpin the transformation of our company.

It’s all about the shareholders

These bumper profits have given van Beurden the chance to treat his shareholders. Combined with 5.5 billion dollars (£4.1 billion) from the sale of a massive US oil field, he plans to return 8.5 billion dollars (£6.3 billion) to investors by buying back their shares. In an update to the stock market on Thursday, he said:

Today we are stepping up our distributions with the announcement of an 8.5 billion dollar share buyback programme and we expect to increase our dividend per share by around 4% for Q1 (first quarter) 2022,

Shell’s adjusted earnings reached 19.2 billion dollars (£14.2 billion) in 2021, more than four times its level a year earlier. Van Beurden added:

We have a compelling strategy, with customers at its core. We have ambitious plans to generate shareholder value, to decarbonise our products and to provide energy to our customers while respecting nature.

Economic justice campaigner and professor Richard Murphy called out this absurd increase in wealth for the select few:

Chancellor Rishi Sunk has announced some support for people to deal with siring energy costs. But Labour MP Chris Bryant said it “isn’t going to touch the sides of the problem”.

Featured image via – Marc Rentschler – Unsplash

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  • Show Comments
    1. “Chancellor Rishi Sunk has announced some support for people to deal with siring energy costs.” This from a
      multi-millionaire, married to a mega-billionaire. Clearly with his finger on the pulse of the situation, or should that be he has his hands around the throat of the public?
      He is another rat who is halfway between the sinking ship and the lifeboat.

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