MUST READ: NEW REPORT SHOWS BIG OIL IS USING WARTINE PROFIT TO ENRICH INVESTORS

Washington, D.C. – Today the Washington Post highlighted a new report showing that big oil and gas companies are using wartime profits from Russia’s invasion of Ukraine to enrich investors, having notably increased stock buybacks and dividends since late February. This report from Friends of the Earth, Public Citizen and BailoutWatch comes the day after Democrats on the House Oversight Committee sent a letter to executives at ExxonMobil, BP America, Chevron and Shell asking for their surging profits to be used to help decrease gas prices and invest in clean energy. 

Separately, VoteVets released a new ad today calling out oil and gas companies for aiding and abetting Putin’s crimes in Ukraine.

The full report, titled Big Oil’s Wartime Bonus: How Big Oil Turns Profits Into Wealth, analyzed Securities and Exchange Commission filings and public statements from Chevron, ConocoPhillips, Devon Energy, EOG Resources, ExxonMobil and the 20 largest oil and gas companies based in the United States. 

Lukas Ross, program manager at Friends of the Earth and co-author of the report, told the Washington Post that “this is a master class in war profiteering. Humanitarian disaster and consumer pain are being turned into Wall Street profits in real time.” As the Washington Post’s Climate 202 points out, the main findings include: 

• “In January and February, seven companies’ boards authorized their corporate treasuries to buy back and retire $24.35 billion in stock — a 15 percent increase over all of the buybacks authorized in 2021. Six of those decisions came in February, after fears of Russian aggression against Ukraine lifted stock prices. In total, the 20 companies announced $45.6 billion in stock buybacks since the start of 2021.
• “More than half of the companies boosted their dividends in January and February. Of the 11 companies raising their dividends, nine were increases of more than 15 percent and four were increases of more than 40 percent.
• “Six companies have started paying additional dividends on top of their routine quarterly payments, including by implementing new “variable dividends” based on company earnings.”

With Americans around the country struggling to fill up their tanks, this report — and the silence on the part of oil companies in response to it — proves that Big Oil continuously seeks to line their pockets, even in times of crisis and when doing so harms American interests, and that it is more urgent than ever to transition to a clean energy economy.  

The full piece in the Washington Post can be found here and below: 

The Washington Post: Big oil companies are using wartime profits to enrich investors, report says

Maxine Joselow

April 5, 2022

Exclusive: Big oil companies are using wartime profits to enrich investors, report says

The nation’s biggest oil and gas companies have significantly increased stock buybacks and dividends since Russia invaded Ukraine in late February, raising questions about whether the firms are using wartime profits to enrich investors instead of curbing Americans’ pain at the pump, three liberal advocacy groups write in a new report shared exclusively with The Climate 202.

The report released today by Friends of the Earth, Public Citizen and BailoutWatch turns up the heat on the fossil fuel industry ahead of two high-profile congressional hearings this week, when Democrats plan to scrutinize the industry’s windfall profits amid rising crude prices sparked by the war in Ukraine. 

The three groups looked at Securities and Exchange Commission filings and public statements from the 20 largest U.S.-headquartered oil and gas companies, including Chevron, ConocoPhillips, Devon Energy, EOG Resources and ExxonMobil.

The groups’ analysis focused on buybacks, which often raise a company’s stock price, rewarding its shareholders. Critics say that buybacks inflate executive compensation while doing nothing to improve a company’s products and services. The groups also examined dividends, the quarterly payments that investors receive for owning shares.

The main findings:

• In January and February, seven companies’ boards authorized their corporate treasuries to buy back and retire $24.35 billion in stock — a 15 percent increase over all of the buybacks authorized in 2021. Six of those decisions came in February, after fears of Russian aggression against Ukraine lifted stock prices. In total, the 20 companies announced $45.6 billion in stock buybacks since the start of 2021.
• More than half of the companies boosted their dividends in January and February. Of the 11 companies raising their dividends, nine were increases of more than 15 percent and four were increases of more than 40 percent.
• Six companies have started paying additional dividends on top of their routine quarterly payments, including by implementing new “variable dividends” based on company earnings.

“This is a master class in war profiteering. Humanitarian disaster and consumer pain are being turned into Wall Street profits in real time,” Lukas Ross, program manager at Friends of the Earth and co-author of the report, told The Climate 202.

One could argue that boosting payouts to investors could be a net positive for the climate, should those investors choose to reinvest their money in renewable energy companies rather than fossil fuel firms. But Alan Zibel, research director at Public Citizen and another co-author of the report, questioned whether that scenario was realistic.

“I wouldn’t necessarily count on investors who collect oil dividends to foster the green energy transition,” Zibel said.

Spokespeople for the oil companies did not immediately respond to requests for comment.

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