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Oil companies record profits amid global crisis “immoral”

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United Nations (UN) Secretary General António Guterres said calling record profits from oil and gas amid the global energy crisis is “immoral”.

Guterres Global Crisis Response Group (GCRG) on food, energy and finance warned skyrocketing energy prices are compounding an existential cost-of-living crisis for hundreds of millions of people as the war in Ukraine continues to rage on.

The secretary general said despite this alarming situation, major oil and gas companies recently reported record profits, which Guterres – who launched the brief, called “immoral”.

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“The combined profits of the largest energy companies in the first quarter of this year are close to $100 billion. I urge governments to tax these excessive profits, and use the funds to support the most vulnerable people through these difficult times.”

The GCRG’s third brief recommends that governments find the most effective ways to fund energy solutions.

These include publicly funded cash transfers and rebate policies, to protect vulnerable communities everywhere, including through windfall taxes on the largest oil and gas companies.

At the same time, the brief urges a transition to renewables.

It comes on the heels of the landmark Black Sea Grain Initiative which was agreed between Russia, Türkiye and Ukraine, under the auspices of the United Nations, on 22 July, paving the way for the first shipment of grains from Ukraine to leave the port of Odesa on 1 August.

There is increasing fear that the rising costs of energy may price out many developing countries, especially the most vulnerable communities, from energy markets, said the UN.

It added that these countries are already bearing the brunt of the cost-of-living crisis having experienced major setbacks on access to energy and progress on sustainable development since the Covid-19 pandemic.

“More worryingly, there could be a potential “scramble for fuel” whereby only countries paying the highest prices can access energy, warns the brief, adding that governments, therefore, need the fiscal space to support their most vulnerable populations to avoid worsening levels of energy poverty or losing energy access altogether.”

The brief makes it clear that the war in Ukraine and the global energy crisis that it has caused is a stark reminder of the need for energy resilience and stronger push for the transition to renewable energy.

According to the brief, an ambitious renewable energy transition, that includes skills training, could create an additional 85 million jobs in renewable energy sources, efficiency, and other energy transition-related sectors by 2030.

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