Big Oil’s profits of £95 billion… but that’s still LESS than the £142 billion made in 2022

The West’s five biggest oil producers made almost £100 billion in profits last year, despite a fall in energy prices.

Total Energies yesterday reported the biggest harvest of its 100-year history as it became the latest major company to post record figures.

The French company said profits in 2023 were £17 billion, up 4 percent on the previous year – but lower than forecasts of around £19 billion.

The update capped off another notable earnings season for the sector, although overall profits were sharply lower than the record-breaking 2022.

BP this week posted a profit of £11 billion for 2023, which was half of what it made in 2022 but the second highest in a decade.

And Shell said last week that profits fell 30 percent year-on-year to a still staggering £22 billion.

In total, the five largest Western oil companies, which also include Exxon Mobil and Chevron, made a profit of £95 billion in 2023.

This was less than the £142 billion they earned in 2022 after Russia’s invasion of Ukraine sent oil and gas prices soaring.

But this hasn’t stopped companies from handing out handsome rewards to their shareholders, with the five Western oil giants returning more than £88 billion in dividends and buybacks by 2023.

That was slightly higher than the £87 billion they handed out to investors in 2022.

“During a time of geopolitical turmoil and economic uncertainty, our goal remained unchanged: safely achieving higher returns and lower carbon emissions,” Chevron CEO Mike Wirth told investors last Friday.

BP is under particular pressure to keep investors on side after the scandal surrounding former CEO Bernard Looney.

He was forced to quit in September after failing to be “fully transparent” about his relationships with colleagues.

The board later found Looney guilty of serious misconduct and stripped him of £32 million in pay and bonuses.

He has now been replaced by Murray Auchincloss.

But these big payouts to corporate shareholders have long drawn criticism as consumers grapple with cost-of-living pressures and cash is needed to tackle the threat of climate change.

Danni Hewson, head of financial analysis at AJ Bell, said the sector has a “major PR problem”.

“There are 95 billion reasons why many cash-strapped households might feel a little miffed about the good fortunes of the five biggest Western oil producers,” she said.

‘Collectively, BP, Shell, Chevron, Exxon Mobil and Total Energies have enjoyed another year of huge profits, not as mind-bogglingly big as last year’s profits, but still a huge amount of cash at a time when many people are still struggling .’

Kathleen Brooks, research director at the XTB trading platform, said Total’s update had “little mention of renewables” but a major focus on “sweeteners for shareholders.”

Total chief executive Patrick Pouyanne said the natural gas unit’s performance was particularly “robust” – thanks to strong production.

This helped offset declining margins and weak demand for chemicals in Europe, he said.