BP profits hit £6.4 billion
BP has announced massive third quarter profits of £6.4 billion resulting from high energy prices, while motorists are struggling to pay for fuel during the economic crisis.
Regarding this 148 per cent rise from last year, Liberal Democrat energy and climate change spokesman Steve Webb said: “These huge profits will be a bitter pill to swallow for families struggling with rising fuel bills.”
Conservative shadow chancellor George Osborne agreed the high energy prices are hurting the public.
“BP have absolutely no excuse for not passing on any fuel price falls to customers. It would be a scandal if they do not,” he said.
BP might be wary of dropping their prices, because other oil companies could follow suit; triggering a price war. Currently, BP is enjoying the earnings of the high profit margins.
BP chief executive Tony Hayward admitted that oil production unexpectedly rose this past quarter and “the high oil price of the third quarter obviously helped our absolute result”.
BP, Europe’s second-biggest oil producer, is reaping the benefits from the high price of oil, but BP claims the profits are also due to “operational improvements and rigorous cost control”.
Mr. Webb believes the oil giant has a responsibility to intervene in the current energy mess.
“The crucial question is whether these profits are now invested in the long-term energy needs of the UK, particularly renewables, or whether they are simply squandered in large dividends to investors,” he said.
“It cannot pretend it does not have the cash to fund a step-change in the way that we generate our power.”
Recently concerns with global recession have pushed the price of oil to the lowest it has been in years.
This decrease might only be short lived for motorists, because of the pound’s slide against the dollar. Last week the pound dropped to around $1.53, which is the largest fall since Black Wednesday in 1992.
BP shares rose 4.3 percent to 457 pence ($7.13) in morning trading on the London Stock Exchange.
