Instead of vilifying, we should be proud of profitable firms like BP - Bill Carmichael

The headlines this week have been brutal after BP reported its biggest profit for 14 years – a tidy sum of £6.9bn for the period from April to June.

BP bosses were “brazen profiteers” and “fat cats” according to one newspaper, which claimed the company was raking in £880 every second, while another went even further with the headline “Greedy Bleeders”.

Another said there was “outrage” over the fact that BP had tripled its profits and planned to increase dividends to shareholders by 10 per cent to £1.1bn,and hand over a further £3.5bn to investors as part of a share buy back programme.

Many other oil and gas and energy companies have made healthy profits in recent months including British Gas owner Centrica, Shell, Total and ExxonMobil.

BP bosses were branded ’brazen profiteers’ after the company tripled profits and planned to increase dividends to shareholders by 10 per cent. Picture: BEN STANSALL/AFP/Getty.

This has led to demands from many Labour and Lib Dem politicians, along with campaigning groups such as Greenpeace and Friends of the Earth, for a new windfall tax on energy companies, on top of the extra 25 per cent tax on profits announced by the UK government as recently as May.

One thing that everyone seems to agree on is that the oil and gas company bosses, and their shareholders, are the villains of the piece.

It is all a bit reminiscent of the Two Minutes Hate directed at Emmanuel Goldstein in George Orwell’s dystopian novel 1984.

Of course, at a time when domestic energy prices are going through the roof and are likely to cause a great deal of genuine distress this coming winter, some of this anger can only be expected.

As the BBC noted: “The same high oil and gas prices emptying the pockets of consumers are filling those of the companies that sell it.”

But we are in danger of demonising successful companies and turning the idea of profit into a dirty word.

And as that wise old saying has it: “If everyone is thinking the same way, nobody is really thinking.”

Let’s get one thing straight from the off – the energy companies are benefitting from increased oil and gas prices, but they didn’t cause the prices to go up. Vladimir Putin is to blame for that. And let’s not forget it is the foolish so-called “green” energy policies of many Western governments – running down nuclear and relying heavily on imported oil and gas to secure the base load that intermittent renewables cannot provide – that has caused the problems in the first place.

Germany, for example, is massively increasing the burning of coal, including lignite, the dirtiest fuel on the planet, to replace Russian gas. It is a bitter irony that Germany’s “green” policies have led directly to huge increases in carbon emissions.

And when we hear talk of “investors” and “shareholders” getting billions of pounds there is a tendency among some people to envisage evil top-hatted capitalists gloating over giant piles of money while orphans and widows starve.

The reality is a bit more nuanced than that.

If you want to know who benefits from the share dividends of energy companies then take a look in the mirror, because there is a good chance it could be you, if you have a pension fund, or any savings or investments.

Pension funds, for example, are some of the biggest investors in the energy sector and there are many orphans and widows who rely on the success of these companies to keep a roof over their heads and food on the table.

BP employs almost 16,000 people directly in the UK, including many highly skilled workers, and the company is one of the leading recruiters of apprentices and graduates, such as at its chemical facility in Hull.

We also rely on energy companies to invest in this country. BP, for example, is investing £18bn in the UK in the current decade, much of it in research into low carbon technologies. If we are ever to approach “Net Zero” we are going to need the expertise and financial clout of the energy companies to get us there.

And let’s not forget also that energy companies are major contributors to the Treasury’s coffers. The windfall tax announced in May, more correctly called the Energy Profits Levy, will bring in a cool £5bn in the first year. That’s a lot of schools and hospitals.

Could the energy companies do more to help customers cope with soaring gas and electricity bills this winter?

Yes, they could, and the first thing the new Prime Minister should do is get on the phone to oil company bosses to explore ways to soften the blow to consumers.

But we should be proud of hugely successful, profitable companies like BP, because that means more highly skilled, well paid jobs, secure pensions, investment in low carbon technology and lots of tax revenue to pay for the services we all value.