Shell CEO says governments need to tax energy firms to help poor

Governments need to tax energy producers to help the poorest people deal with the soaring cost of fuel, said the CEO of Shell.

“One way or another there needs to be government intervention,” Shell chief executive officer Ben van Beurden said at the Energy Intelligence Forum, a major conference for oil and gas producers in London on Tuesday.

“Protecting the poorest, that probably may then mean that governments need to tax people in this room to pay for it.”

Europe Union ministers reached an agreement last week on an initial energy package, setting a goal to reduce power consumption and agreeing to tap windfall profits of companies and redirect them to customers and businesses. The bloc has also discussed capping the price of natural gas and power in a bid to protect consumers.

Van Beurden criticized the latter approach, saying that companies like Shell would struggle to bring extra supplies of natural gas to Europe if a price incentive wasn’t there.

“We will do our best to bring gas to Europe where it’s needed, but if the market signal is not there it’s going to be really challenging,” van Beurden said.

Mr van Beurden’s comments come as industry figures in the UK have staunchly fought the imposition of a windfall tax on operators, citing concerns around the impact it could have on security of supply.

A levy was imposed by former chancellor Rishi Sunak in May, increasing the headline rate of tax on oil and gas companies from 40% to 65%, though there are certain investment incentives to offset that.

Earlier that month, Mr van Beurden said Shell decisions on investments like EV infrastructure in the UK were unlikely to be impacted by such a levy.

It was unveiled two weeks ago that Mr van Beurden would step down as head of Shell at the end of this year, to be replaced by Wael Sawan, Shell’s head of integrated gas and renewables, effective from January 1.