BP boss insists profit jump will benefit pension savers

BP’s boss has insisted the company’s rising profits will benefit Britain’s pension savers, as Boris Johnson appeared to rule out a windfall tax.

Bernard Looney said the company was rewarding shareholders who are “real people” as it posted underlying quarterly profits of $6.2bn [£5bn] – its highest in more than a decade.

The results have fuelled further calls for oil and gas producers to face windfall taxes as they benefit from surging wholesale oil and gas prices which are pushing households into poverty.

Rishi Sunak, the chancellor, last week suggested the measure could be introduced if companies did not invest enough in producing energy.

However, speaking on ITV on Tuesday morning, the Prime Minister warned the move could discourage that investment which will “in the end will keep prices lower for everybody.”

Mr Looney said BP planned to invest £18bn in the UK up to 2030 and was already likely to pay “probably four to five times” more tax in Britain this year than over the past several years.

It is accelerating its share buybacks to $1.5bn per quarter, up from $1.25bn, and is maintaining its dividend at 5.46 cents per share.

He added: “We should remind ourselves, it’s only 15 months ago that we made our largest loss in history, in large part because of lower prices.

“Nonetheless, we’re here today with high oil prices and strong profits. The question is, what are we doing with the money?

“If you’re paying into a pension in the UK, or drawing a pension in the UK, you are influenced by how much BP returns.”

High wholesale gas prices are the main driver behind a 54pc increase in Britain’s energy price cap on April 1 which has pushed household bills up to an average £1,971 per year.

BP’s FTSE 100 rival Shell is set to report results on Thursday morning, adding to the scrutiny on producers.

BP’s strong financial results were driven not just by high prices but by the volatility in prices which has helped the company’s trading division.

Russia’s war on Ukraine has led to huge disruption on oil and gas markets, with refining margins also increasing.

BP announced days after Russia’s war began that it will exit its19.75pc stake in Russian state oil giant Rosneft, with both Mr Looney and his predecessor Bob Dudley resigning from its board.

On Tuesday it has valued the stake at zero given the uncertainty over the terms of the exit, leading to a $24bn write down.

That pushed the company to a headline loss of $20bn, but the underlying profits of $6bn exceeded analysts’ expectations.

Shares rose 3pc to 403p by early afternoon.