Oil majors BP and Royal Dutch Shell Plc have unveiled record quarterly profits of $10 billion (a rise of 148 per cent) and $10.9 billion (a rise of 71 per cent, respectively, boosted by high oil prices and asset sales.
BP, which reported a 148 per cent rise in third quarter net profit at $10 billion (£6.4 billion), was also at the centre of a big controversy of profiteering amidst signs of a global slowdown. Critics also renewed calls for fuel price controls and windfall taxes on oil companies.
BP, however, argues that it is already the nation's biggest taxpayer and that its dividend payout is less than 10 per cent of the profit and that it uses its profits to invest in new sources of alternative energy.
BP said it had paid over $5 billion as taxes in the UK alone over the past three years and including excise duty and VAT on fuel, the total would rise to almost £21 billion.
Shell said its current cost of supply (CCS) net profit jumped 71 per cent to $10.9 billion in third quarter. CCS result excludes unrealised gains or losses related to changes in the value of fuel inventories and included a net gain of $2.06 billion due to non-operating items, mainly related to the sale of a German gas network.
Even excluding non-operating items, the CCS net profit was $8.84 billion, compared with just over $4 billion for the same quarter last year.
Oil prices hit a record $147 a barrel in July, with BP selling crude at an average price of $111. Crude oil prices rose to around $70 a barrel today, up from just over $60 a barrel yesterday.
The oil price rise has clearly helped the oil producer-refiners most.
''Although it has since fallen away sharply, the high oil price of the third quarter obviously helped our absolute result,'' said Tony Hayward, chief executive of BP.
''We are making good on our promise to deliver the strategy we laid out earlier this year: upstream growth, downstream turnaround and corporate simplification,'' he added.
While BP and Shell have profiteered, speculation in the oil market has wreaked havoc in the real economy and stoked up inflation. Union leaders and politicians have called on the authorities to hold prices and curb speculation.
''BP has absolutely no excuse for not passing on any fuel price falls to customers, '' said George Osborne, the UK's shadow chancellor.
Prime minister Gordon Brown also joined the chorus, saying, ''There has been a more than halving in the price of oil and, just as when the price goes up people see it immediately reflected in petrol pump prices, we want to see the falling price reflected in petrol pump prices and we are determined to see that happen."