Big Oil poised to smash annual profit records — sparking outcry from campaigners and activists
U.S. President Joe Biden has previously singled out Exxon Mobil for making “more money than God” last year.
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Some of the world’s largest oil and gas companies are poised to report record annual profits, raking in extraordinary revenues following a year of volatile fossil fuel prices amid Russia’s onslaught in Ukraine.
Oil majors Exxon Mobil, Chevron, BP, Shell and TotalEnergies are slated to report a combined profit of $190 billion for 2022 when their final quarterly results are released in the coming days, according to estimates from analysts collated by Refinitiv.
Flush with cash, the energy giants are expected to use their windfall profits to reward shareholders with higher dividends and share buybacks.
U.S. President Joe Biden has previously accused oil companies of reaping a “windfall of war,” while simultaneously refusing to help lower gas prices at the pump for American consumers. In June last year, Biden singled out Exxon Mobil for making “more money than God.”
Exxon Mobil spokesperson Erin McGrath told CNBC higher energy prices are “largely as a result of a supply-demand imbalance” and that it is the firm’s investments over the last five years that are driving quarterly results.
McGrath said Exxon sees its success “as an ‘and’ equation, one in which we can produce the energy and products society needs — and — be a leader in reducing greenhouse gas emissions from our own operations and also those from other companies.”
Spokespeople for BP and Shell did not wish to comment ahead of full-year results, while Chevron and TotalEnergies did not respond when contacted by CNBC.
In recent quarters, Big Oil executives have said the significant disruption to global energy markets due to the war in Ukraine has reaffirmed the importance of helping to solve “the energy trilemma.” This, according to a statement to investors from BP CEO Bernard Looney late last year, refers to “secure, affordable and lower carbon energy.”
“They are profiting from the current increase in oil and gas prices, and they are betting on it. And what you see is actually increased investment in oil and gas,” Agathe Bounfour, oil campaign lead at the NGO Transport & Environment, told CNBC via telephone.
“I think given that prices of oil and gas are likely to stay up, it’s important for us to reflect on the fact that these profits are going to stay high at the same time as many households are struggling with energy prices,” Bounfour said.
“There’s not much point [in] raising revenues and subsidizing the industry at the same time,” she added.
‘The year the empire struck back’
The Big Oil profits are seen from within the industry as something of a vindication. The energy giants came under immense pressure from shareholders and activists to invest in clean energy as oil demand cratered in the peak of 2020 lockdowns.
The push toward green reform lost momentum last year, however.
The oil and gas industry has sought to underline the importance of energy security amid calls for a rapid transition to renewables, typically highlighting that demand for fossil fuels remains high.
“I have called 2022 the year the empire struck back,” Mark van Baal, founder of Dutch shareholder activist Follow This, told CNBC via telephone.
“What we saw happening in 2022 is that the oil majors used the high oil prices and the energy crisis to convince investors that the energy crisis should eclipse the climate crisis — and that has caused a setback,” van Baal said.
The logo of Shell on an oil storage silo, beyond railway tanker wagons at the company’s Pernis refinery in Rotterdam, Netherlands, on Sunday, Oct. 23, 2022.
Bloomberg | Bloomberg | Getty Images
After ultimately failing with several climate resolutions in 2022, van Baal said it was clear from discussions with oil majors that they were once again determined to fend off activist and shareholder pressure and continue with their core oil and gas businesses.
“The attitude of the oil industry is ‘we have a very handsome business model and we’re going to defend it tooth and nail,'” van Baal said. “The reason it is so handsome is because there are so many externalities not inside their costs — and, of course, the biggest one is the cost of climate change.”
Van Baal added, “My hope is not with the boards of these oil majors, my hope is that the investors will realize that we don’t have time for another round of discussion, another year of engagement and another year of the benefit of the doubt.”
‘Harming both people and the planet’
Record earnings from the West’s largest oil and gas majors have also renewed calls for higher taxes, particularly at a time when surging gas and fuel prices have boosted inflation around the world.
Alice Harrison, fossil fuels campaign leader at advocacy group Global Witness, said, “We must all call out profiteering like this.”
She described the historic revenues for energy giants as “disgraceful” given that “much of this money is being made at the expense of the millions of people who have been pushed into poverty because of the skyrocketing cost of gas.”
“An increased windfall tax to help those struggling to pay their bills, along with a significant boost in renewable energy and home insulation, would end the fossil fuel era that is harming both people and the planet so severely,” Harrison told CNBC via email.
To be sure, burning fossil fuels, such as coal, oil and gas, is the chief driver of the climate emergency.
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Tesla has started offering leases of certified pre-owned cars, which is relatively rare in the industry, with $0 down as it desperately tries to move vehicles before the end of the quarter.
With the federal tax credit for electric vehicles set to expire at the end of the quarter, automakers in the US are all trying to optimize EV sales, as demand is being pulled forward.
This also applies to used EVs, as the $4,000 federal incentive for used electric vehicles will also expire on September 30th.
Now, leasing used vehicles is much less common than leasing new cars, but some automakers, or mainly dealers, do offer it.
Tesla is getting into this business for the first time.
In California and Texas, Tesla is now offering leases on certified pre-owned (aka used) Model 3 and Model Y vehicles.
These are reasonably priced and can be as low as $215 per month with $0 down for a 24-month lease and 10,000 miles per year.
Tesla also offers a 12-month lease and up to 15,000 miles annually. While there’s no down payment needed, there’s an “Acquisition Fee” of $695.
That, and the first month, is all you need to get in a used Tesla for the next year or two.
This is undoubtedly the cheapest way to get into a Tesla vehicle right now.
Tesla is trying to sell as many vehicles as possible in the US this quarter, as demand for EVs has been pulled forward due to the end of the tax credit. This is expected to result in a record quarter in the US, but it also going to create a few difficult ones in the future.
With demand being pulled forward and future buyers feeling like they missed out on EV discounts, the US EV market is expected to experience a significant slowdown over the next 12 to 18 months.
Tesla sales are down about 13% globally so far this year. While this quarter is expected to be better, many analysts still anticipate Tesla’s year-over-year performance to be down.
This year alone, Tesla added more than 50,000 electric vehicles to its inventory.
Used cars have also been piling up.
Tesla owners rushed to sell their vehicles as Tesla’s brand perception dived following its CEO’s involvement in politics.
We previously reported that the average used Tesla sale price has recently dipped below the overall average used car sale price in the US.
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Danish equipment makers HG build job site dumpers that help move sand, rocks, debris, construction waste, and building supplies across rugged, uneven urban job sites. And with the introduction of their newest E3000 model, they’re helping move more than three tons of that stuff without emissions and — just as crucially — without noise.
HG announced the E3000 electric site dumper just this week, adding the new 3 tonne capacity to its growing lineup of 1 and 2 tonne dumpers (that’s over 6,600 lbs., in “landed on the Moon” units). With a 180° swivel tip on the bucket as standard equipment and an optional high tip version available at launch, it should be able to handle just about anything a hard working construction crew can throw at it.
“With the HG E3000, we once again prove that electric dumpers are not only better for people and the environment. They are also more efficient, cheaper to operate, and can run more than a full working day on a single charge,” explains Nikolaj Birkerod, CEO of HG, told Power Progress. “With 3 tonne dumpers, we are proving, as we already have with 2 tonne dumpers, that we can deliver on both performance and reliability while enabling customers to save 15% per operating hour compared to a diesel dumper.”
Exact specs haven’t been released, but HG claims the E3000’s 29 kWh is good for 12 full hours of continuous, loaded operation, and that it can be fully recharged on a “standard” 220 charger (L2) in about four hours. If you’re curious about what has been released, I’ve got all that for you right here:
The only all-electric dumper on the market that gives you 12 working hours while carrying 3 tonnes payload.
Our latest addition to accelerate 100% machinery:
- 3-ton payload for high-capacity material handling
- 12-hour working – a full day’s work without recharging
- Optional high tip for quick and flexible unloading into containers and trucks
- 180° swivel tip as standard for precise placement of loads
- Fast charging: 0–100% in approx. 4 hours with the integrated charger
- Lithium 29 kWh battery with automatic heating for all-season use
- One-pedal drive for smooth and intuitive operation
The E3000 is built for contractors and rental companies who demand maximum productivity without compromising on environmental responsibility.
With a carrying capacity of 3 tonnes and an industry-leading 12 hours of effective runtime on a single charge, it’s proof that heavy-duty work and zero emissions can go hand in hand.
At the heart of the E3000 is HG’s patented articulated drivetrain with four independent in-wheel motors. This unique design delivers the most energy-efficient power transfer in the industry, using significantly less power than conventional electric system. This translates directly into lower operating costs and more hours on site between charges.
No word yet on pricing or whether or not the new dumper will eventually be sold outside the European market, but we do know that HG plans to deliver the first examples of its new machine to customers by early 2026.
Electrek’s Take
While there are a lot of people outside the urban construction space who may scoff at environmental concerns, the quest for improved efficiency and cost reduction among commercial fleet managers knows no political ideology. Add in more restrictive noise regulations and the side benefits of improved job site safety and fewer sick days, and electric equipment is a no-brainer.
Simply put: If it’s better or cheaper, fleets will buy it. If it’s better and cheaper, they’ll buy two — and battery powered equipment is proving to be consistently better, in a broader scope of use cases, than diesel.
SOURCES | IMAGES: HG Machines, Power Progress.
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