29 March 2022, NEW YORK / LONDON — As American families continue to be hammered by skyrocketing gasoline prices, U.S. oil and gas companies are poised to reap tens of billions in windfall profits thanks to high wartime prices.

New analysis by Global Witness, Greenpeace USA and Oil Change International finds that high oil prices due to Russia’s invasion of Ukraine will net the U.S. upstream oil and gas industry a windfall of $37 to $126 billion (all totals USD) in 2022 alone.

The analysis comes amidst a flurry of debate on how the government can best address gasoline prices that have surpassed $6 per gallon in some states. Despite misleading talk of ‘energy independence’ from some politicians, the United States can’t drill its way to lower gasoline prices — oil prices are set on an integrated global market. Additionally, fossil fuel companies already hold leases to extract more oil and gas than global carbon budgets allow to meet climate targets. The Big Oil Windfall Profits Tax bill currently being considered by Congress is a better method of easing the financial burden placed on working families.

Murray Worthy, Gas Campaign Leader at Global Witness, said:

"It's clear the energy system is deeply broken when the companies that are driving the climate crisis are the ones who reap the rewards when hospitals and schools are being bombed in Ukraine. Shovelling billions of dollars into Big Oil's pockets will only lead to more fossil fuels. But to escape the crises of spiralling energy prices, wars funded by petrostates and the climate emergency, we urgently need a world beyond fossil fuels."

Collin Rees, United States Program Manager at Oil Change International, said:

“From lobbying against climate solutions to actively spreading misinformation, the oil and gas industry has spent decades doing everything in its power to deepen our dependence on dirty fossil fuels. Now, Big Oil and Gas executives are rolling in cash while working families suffer from sky-high profits. It's high time for Congress to pass a windfall profits tax and prevent the fossil fuel industry from harnessing a war to make billions. This can be a clear step toward a fossil-free future if paired with real investments in a renewable energy future.”

Tim Donaghy, Research Manager at Greenpeace USA, said:

“It is unconscionable that U.S. upstream companies like Chevron, Occidental and ExxonMobil, who receive federal tax subsidies totaling millions of dollars every year, are now set to make billions of dollars more from these high wartime gas prices. American consumers don’t get a break from high prices just because we drill more here at home, instead, we get more air and water pollution and higher public health risks. The only way to achieve true energy independence is to cut our ties with fossil fuels entirely.”

Cassidy DiPaola, Spokesperson for Stop the Oil Profiteering Campaign at Fossil Free Media, said:

“While Americans are struggling to keep up with high prices at the pump and on their utility bills, Big Oil is profiting off of the war in Ukraine, driving up gas prices and raking in record profits. Fortunately, there's a simple way to stop this profiteering: put a tax on the excess profits oil companies are making because of this crisis and use the money to send a check to the people who need it. Making Big Oil pay for their greedy war profiteering is a win-win for our families and the climate.”

The top ten companies by projected 2022 free cash flow from U.S. oil and gas production are:

  1. ConocoPhillips
  2. Chevron
  3. Occidental Petroleum
  4. Exxon Mobil
  5. EOG Resources
  6. Pioneer Natural Resources
  7. BP
  8. Devon Energy
  9. Shell
  10. Diamondback Energy

The analysis was done using Rystad Energy’s UCube — a database that tracks the oil and gas industry’s production economics at the well level. Before the most recent phase of Russia’s war against Ukraine began, the forecast oil price for 2022 used in Rystad Energy’s upstream database was $70 per barrel, in line with the U.S. Energy Information Administration’s December 2021 assessment. On March 9, Rystad updated its 2022 oil price to $88 per barrel. But oil prices could remain elevated if Russia’s supply is severely curtailed, represented by the $120 case. Some analysts believe that prices could even hit $200 per barrel this summer. We ran two scenarios comparing the pre-war price of $70 per barrel with the updated base case of $88 per barrel and a high case of $120 per barrel. These scenarios also include similarly higher gas prices in their analysis of companies’ cash flow.