Profits worth billions of pounds have been announced by energy giants Centrica and Shell at a time when huge hikes in fuel and energy bills have contributed to a UK cost of living crisis.
British Gas parent company Centrica recorded an increase in operating profits to £1.34billion for the first six months of the year, up from £262million a year earlier, as the war in Ukraine continues to push up gas prices, reports the Mirror.
And British Gas reported an adjusted operating profit of £98million, down 43% compared to last year - but only because the energy giant took on more than 200,000 customers after dozens of its rivals went bust. It said it needed to buy more energy to cope with demand.
Rival Shell saw its profits hit an all-time high of £9.5billion in the second quarter, smashing the oil giant's previous record quarterly profit of £7.5billion racked up in January to March this year.
The news comes as families across the UK face another unprecedented increase to the Ofgem energy price cap, which already stands at £1,971 for someone with typical use. Energy consultants at Cornwall Insight then put the October price cap at the slightly higher £2,879 and £2,907 in January 2023.
However energy experts at BFY now say energy prices could hit £3,420 in October - then £3,850 when the price cap is reviewed again in January 2023. Just q year ago in July 2021 the price cap was only £1,138 a year - and most energy deals were much cheaper even than that figure.
The enormous size of the oil companies’ profits forced the Government to give in to demands for a windfall tax - but this didn't become law until July 14. The boss of Centrica has said he expects the company's growth to continue in the second half of the year - but admitted the winter will be tough for customers.
It comes as Centrica confirmed it has resumed payouts to shareholders, paying an interim dividend of 1p per share, after having suspended it for three years.
Centrica boss Chris O'Shea said: "We are very aware of the difficult environment many customers are facing and we will continue supporting them."
Shell’s chief executive officer, Ben van Beurden, said: “With volatile energy markets and the ongoing need for action to tackle climate change, 2022 continues to present huge challenges for consumers, governments, and companies alike.
“Consequently, we are using our financial strength to invest in secure energy supplies which the world needs today, taking real, bold steps to cut carbon emissions, and transforming our company for a low-carbon energy future.”
Energy bills first started rising due to increased supply and demand following the Covid pandemic. The war in Ukraine has threatened supplies from Russia, which has also pushed up prices.
Read Next
- Can you wash your clothes in cold water to save money?
- Old-fashioned money-saving tips - how many do you do?
- How your bill is calculated and why your standing charge has also gone up
- Supermarkets to take part in trial that could see return of cash for recycling pop bottles
- Little-known tip for Boots advantage card holders to get extra points
