Major U.S. oil companies have made more than $200 billion in profits from Russia’s invasion of Ukraine as they capitalize on a period of geopolitical turmoil that rocked the global energy market and sent fuel prices skyrocketing, according to the British newspaper Financial Times. At the same time, European households are paying huge electricity and gas bills despite efforts by governments to send billions of dollars to protect citizens from the energy crisis. Currently, the average retail price of natural gas in the EU and the UK is almost 18 euro cents per kilowatt-hour, double what it was in the same month in 2021, according to data from consultancy VaasaETT. And the cost of electricity for households jumped by 67%, to 36 eurocents per kilowatt-hour.

According to an analysis of earnings reports and estimates by S&P Global Commodity Insights for the Financial Times, the total net income of public US oil and gas companies was $200.24 billion for the second and third quarters of the year. This figure, which reflects revenues from operations of large, medium and small groups, as well as individual shale operations, marks the most profitable six months in the history of the industry and sets it on a path of unparalleled performance. “Operating cash flow is likely to break records – or at least come close to it – by the end of the year,” said Hassan Eltori, chief research officer at S&P. Huge oil windfalls are angering the White House as higher gas prices weigh on Democrats in opinion polls ahead of today’s pivotal midterm elections. US President Joe Biden called the excessive profits a “surprise war” and accused the companies of “speculating” on Moscow’s invasion of Ukraine. He added that he would ask Congress to impose higher taxes on them if they did not invest their income in pumping more oil to lower the price at gas stations.

Such unexpected tax legislation is unlikely to be passed in Washington, although it has become a reality across the Atlantic. Brussels introduced a 33% “solidarity levy” on windfall profits, and London introduced an additional 25% “energy profits levy”, raising income tax to 65% by the end of 2025. Rishi Sunak, the new UK Prime Minister, is considering increasing the fee to 30% and extending it until 2028. Recall that Brent crude oil, the international benchmark commodity in Europe, in the second and third quarters exceeded an average of $105 per barrel. , which is well above the average of around $70 a barrel over the past five years – it reached a record high of $140 a barrel in early March following the Russian tank invasion of Ukraine.