Windfall tax plans rubbished by economists after oil giant’s losses last year
Economists and BP’s boss rejected calls yesterday for a windfall tax on energy giant announced healthy profits.
The British firm’s chief Bernard Looney said it would be misguided to limit its ability invest and reduce North Sea gas impact.
The Labour Party have been pushing for a one-off levy on energy firms amid spiking household costs.
But Looney argued “the UK needs more gas, right now. Thats going to require more investment, not less investment.”
Calls for a tax raid have increased in the week since Shell also revealed chunky profile.
BP lost £4.2bn in 2020 amid a collapse in global demand for oil, similarly to most fossil fuel majors.
Speaking to City PM, Andy Mayer from the Institute of Economic Affairs said: “Fossil fuel energy companies have not enjoyed ‘windfall’ profits. They lost billions in 2020, when the pandemic caused prices to plunge. They regained some of this in 2021-22 when economic activity restarted.”
Michael Hewson, chief market analyst at CMC Markets, described the calls for a tax as “predictable.”