Harbour Energy PLC (LSE:HBR), the North Sea’s largest oil and gas producer, unveiled colossal half-year earnings on Thursday.
The Edinburgh-based company also promised shareholders it would dish out an additional US$200mln following a 12-fold increase in profits to £1.3bn (US$1.5bn).
Coming just a day before Ofgem is expected to almost double the household price cap (read more) it has put how much money is being made by the North Sea-based oil and gas companies firmly front and centre again.
Most analysts expect Ofgem to raise the energy price cap to somewhere between £3,550 and £3,750 tomorrow as August, traditionally a quiet month, has seen wholesale prices soar.
This has been largely attributed to a Russian squeeze and a rush for supplies ahead of the Nord Stream pipeline’s maintenance turn-off next week, which traders fear might become permanent.
Through Nord Stream is where most of Germany and northern Europe's gas is transported.
Even though the UK is not receiving any gas from Russia (read more), it is still being affected by the volatile market dynamics.
Prices for a therm of gas have risen to 390p from 114.5p a year ago according to the UK National Balancing Point, which includes liquefied natural gas (LNG) tankers, imports piped from Norway and continental Europe, storage and UK natural gas production.
That is being reflected in the forecasts both for the energy cap and inflation generally.
In the past 18 months, over 30 UK energy suppliers collapsed on skyrocketing wholesale costs, which further exacerbated the problem of unprecedented prices.
To combat reduced global supply, UK domestic gas production in the first half of the year surged 26% higher compared with the previous year, according to Offshore Energies UK (read more).
Centrica PLC (LSE:CNA)-owned British Gas revealed in its latest half-year results that it made underlying profits of £1.66bn and today it vowed to return 10% of that to struggling customers.
Shell PLC (LSE:SHEL, NYSE:SHEL), meanwhile, reported record second-quarterly results in July, as it smashed its previous best that was set just three months before, with profits of US$11.5bn.
BP PLC (LSE:BP.), Shell’s largest rival, also unveiled bumper quarterly profits amid the recent energy crisis.
The energy giant reported profits of £6.9bn - more than triple the amount made in the same three months last year – which was it's second highest on record and best in 14 years.
With the energy price cap tipped to reachat least £5,000 from April 2023, few would bet against renewed calls for a new windfall tax to follow swiftly after Ofgem's announcement.