Wednesday, April 30, 2008

Shell and BP's "Blow-Away Numbers

excerpt from:
Outcry as Shell and BP make billions on back of price rises

- Times Online

by Robin Pagnamenta and David Robertson

Surging oil prices helped to boost profits at BP and Royal Dutch Shell to a combined record of £7.2 billion for the first quarter of the year.

Amid growing accusations of profiteering by big oil companies, it also emerged that BP had earned a one-off trading profit of $400 million (£203 million) by correctly betting on the direction of oil and gas prices.

The figures provoked an immediate outcry from campaign groups, which said it was a disgrace that at a time of increased public concern about climate change Shell and BP were earning their biggest profits, while compounding the problem of rising global carbon emissions.

A spokesman for the trade union Unite said that the profits were unacceptable and called for them to be used to improve pension provision for staff.

BP's pre-tax profits surged 48 per cent in the first quarter to £3.3 billion while Shell increased its profits 12 per cent to a record £3.9 billion. The rising profits were driven by spiralling oil prices, which the companies have passed on to consumers in the form of higher petrol and diesel prices. Yesterday the price of crude oil was trading slightly below record highs of $120 a barrel.

Both Shell and BP's figures were much higher than expected. Jason Kenney, an oil analyst at ING, described them as "blow-away numbers".

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