“Grotesque greed!” | UN chief calls for additional fees

Reading time: 2 minutes

The Secretary General of the United Nations (UN) Antonio Guterres has asked governments around the world to apply special taxes to oil and gas companies, accusing them of “grotesque greed”, reports the BBC.

Guterres said it is “immoral” for major oil and gas companies to profit from the crisis triggered by Russia’s invasion of Ukraine, as more and more major companies announce record profits amid rising energy prices .

Russia’s invasion of Ukraine in February deepened the global oil and gas shortage, disrupting access to oil and gas from Russia, one of the world’s leading suppliers of energy raw materials. While household consumers face rising energy bills, companies are reaping the benefits, the UN chief charged.

For example, British Petroleum (BP) recently reported its highest profit in 14 years, while Shell’s profits in the second quarter of this year reached a new record in the company’s history.

Together, four of the world’s largest energy firms – Exxon, Chevron, Shell and TotalEnergies – reported profits of nearly $51 billion in the second quarter, nearly double their profits in the same period last year.

“This grotesque greed punishes the poorest and most vulnerable of people. I urge all governments to impose duties and taxes on these excessive profits and use the funds to support the most vulnerable in these difficult times,” said Antonio Guterres.

Last month, the UK passed a 25% “extraordinary levy” on energy companies, with the government estimating that the measure will bring in around £25 billion to the budget, which will be used to offset household energy bills. Other countries, including Italy, have imposed similar measures.

On the other hand, French lawmakers recently rejected such a decision, and in the US there seems to be no political will to do so, despite a proposal to impose an exceptional tax on energy companies, submitted by a group of members of Congress.

Frank Macchiarola, vice president of the American Petroleum Institute, an oil and gas industry lobby group, said the idea of ​​such a tax is deeply flawed:

“Politicians should focus on increasing energy supplies and reducing costs for American consumers. Imposing new taxes on our industry will have the exact opposite effect and discourage investment at a time when it is most needed,” he said.

Antonio Guterres warned that high energy prices would have far-reaching consequences, as consumers and governments around the world could buckle under the pressure:

“Many developing countries – drowning in debt and without access to finance, struggling to recover from the crisis caused by the Covid-19 pandemic – could reach the limit. In fact, we can already see warning signals announcing a wave of economic, social and political unrest that would not spare any country in the world,” the UN chief said.