Proactive Investors - Shell (LON:RDSa) and BP PLC (LON:BP.) were among oil and gas giants which bagged billions of dollars from trading on commodity markets last year, according to estimates from Bernstein Research.
20% of Shell’s pre-tax earnings came from the US$16.6bn generated from buying and selling oil, gas and power in 2022.
BP scored 16% of its pre-tax earnings this way meanwhile, equating to US$11.5bn.
Collectively, the top 11 traders earned US$77bn on the world’s energy markets in 2022, more than double the US$37bn averaged in 2020 and 2021 respectively, after wholesale prices soared.
TotalEnergies (LON:TTEF) and Equinor were also among the top earners from trades in 2022, alongside coal giant Glencore PLC (LON:GLEN) and private commodity traders Vitol, Gunvor and Trafigura.
Traders often buy and sell commodities on wholesale markets months in advance, including oil, gas and electricity, which soured in value last year in the wake of the Ukraine war.
Higher earnings from trading activities were likely a result therefore, though companies often provide little detail of these in reports, with Bernstein’s figures purely estimates.
BP, for instance, simply referenced “an exceptional gas marketing and trading result [...] and a very strong oil trading result,” as it reported a US$5bn first-quarter profit on Tuesday, in an update that sparked fierce backlash from politicians who argued the 35% oil and gas windfall tax should be raised.
According to Berstein, there has been a “buzz around trading” due to the ongoing “uncertain price outlook across energy products,” which have fluctuated since mid-2021.