Big Oil companies gush profits as readily as Wall Street gushes affection for their shares. At the White House a different sentiment prevails. President Joe Biden has threatened to impose a windfall tax on major oil companies unless they increase output.
ExxonMobil’s latest payout plan will do little to defuse tensions. The US oil producer intends to expand its share buyback programme for a second time this year. It will spend $50bn from this year to 2024. That is an annual increase of 11 per cent from the current programme — one that was only announced in April.
Biden’s case for a windfall tax — variations of which are already in place in the EU and the UK — may seem straightforward. In the wake of Russia’s invasion of Ukraine, sky-high oil prices have allowed integrated oil companies to profit from helpless consumers. Exxon is expected to earn a record $59.4bn in net income this year.