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Date : June 17, 2024

TotalEnergies income hits $6.6 billion despite Russia loss

TotalEnergies income hits $6.6 billion despite Russia loss

PARIS (AP) — France’s TotalEnergies on Thursday reported third-quarter net income rose to $6.6 billion despite losses from pulling out of a venture in Russia, with huge oil and gas company profits raising pressure on European governments to shield people from high energy bills.

The company posted adjusted net earnings of $9.9 billion but notably took a charge of $3.1 billion after it sold a 49% interest in a Siberian natural gas field to Russian energy producer Novatek.

Total CEO Patrick Pouyanné acknowledged the effect of Russia’s war in Ukraine in raising oil and natural gas prices this year, saying the company “leveraged its integrated model, particularly LNG (liquefied natural gas), to generate results in line with previous quarters.” Europe has increasingly turned to LNG as Russia has slashed natural gas flows amid the war.

Total’s gas and renewable energy sector posted record operating income of $3.6 billion in the third quarter, a $1.1 billion increase from the previous quarter, Pouyanné said. Total’s overall earnings were up 43% from the third quarter of last year.

The war in Ukraine sent oil and natural gas prices soaring this year, and though they have dropped from summer peaks, they are still high and driving inflation that has made everything from utility bills to groceries more expensive.

Higher energy prices sent company profits skyrocketing, with London-based Shell also reporting earnings nearly doubling to $9.45 billion in the third quarter.

The European Union passed a levy on the windfall profits of energy producers last month to fund relief for people and businesses hit by the energy crisis.

Energy prices and inflation have fueled disruptive protests across France and other places in Europe.

Earlier this week, workers in Total’s refineries in France ended nearly a monthlong strike that sparked gasoline shortages nationwide and mobilized industrial action for pay hikes that keep up with the soaring cost of living.

French Economy and Finance Minister Bruno Le Maire hailed Total’s profits Thursday, saying that “we should all be satisfied with this success.” In an interview with TV broadcaster BFM, he said those earnings have enabled the extension of a fuel price cap until mid-November.

However, Le Maire urged the company to share its profits with its employees by raising their wages and paying out an end-of-the-year bonus.

“This is good news, if they share the profit … if they lower the (energy) bill of the French people,” French Minister of Public Accounts Gabriel Attal told public radio FranceInfo.

“We will tax them,” Attal said, referring to the EU levy of at least 33% on the surplus profits of companies producing or refining oil, natural gas and coal.

An agreement of the 27 EU countries on further measures to tackle the energy crisis has been postponed for another month amid struggles to overcome the influence of fluctuating global energy markets and different energy mixes among member states.

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