(Reuters) – BP (BP.L) more than doubled its third-quarter profit from a year earlier to $8.15 billion and expanded its share buybacks by $2.5 billion, joining rivals in reporting bumper profits that have sparked renewed calls for energy companies to pay more taxes.
London-based BP joins rivals including Shell (SHEL.L), Exxon Mobil and TotalEnergies (TTEF.PA) which also reported bumper profits last week that also saw the sector pay out a record $29 billion to shareholders.
U.S. President Joe Biden on Monday called on major oil companies who are bringing in big profits to stop “war profiteering“, threatening to hit them with higher taxes if they don’t increase production.
BP said it expects to pay around $2.5 billion in taxes on its British North Sea business this year, including $800 million in a 25% windfall tax the government imposed in May.
British UK Prime Minister Rishi Sunak’s government should explore extending that windfall tax on oil and gas firms in a fiscal statement due next month, the president of the COP26 climate summit, Alok Sharma, said on Friday.
BP paid $5 billion in tax around the world in the third quarter at a rate of 37%, Chief Financial Officer Murray Auchincloss told Reuters.
Auchincloss would not comment on Biden’s comment, but said BP is increasing the number of drilling rigs in the Gulf of Mexico and shale basins to boost output.
BP, which increased its dividend by 10% in the quarter, will buy back $2.5 billion of shares after repurchasing $7.6 billion so far this year. BP has committed to using 60% of its excess cashflow for shareholder returns.
The top five Western oil and gas firms paid out to investors a record $29 billion in dividends and share buybacks in the third quarter, according to Reuters calculations.
BP shares were up 0.6% by 1255 GMT, lagging a 1.4% rise in the broader European energy index (.SXEP).
“With the BP share price sitting near its highest levels this year, today’s Q3 numbers were always likely to be political catnip if they were anywhere near as good as Shell’s last week,” said Michael Hewson, chief market analyst at CMC Markets UK.
BP’s shares have gained more than 45% this year, buoyed by stronger oil and gas prices, but they have trailed gains by Shell and U.S. rivals Exxon Mobil and Chevron.