Oil companies making excessive profits from European drivers

30 Mar Oil companies making excessive profits from European drivers

(Oilandgaspress) Oil majors are set to make a €24 billion windfall from European drivers off the back of the latest conflict in the Middle East, a new T&E tracker shows. Oil companies have already made €1.3 billion in excess profits, the analysis shows. T&E calls on the EU to implement a tax on excess profits and use the funds to support Europeans to become less vulnerable to future oil shocks.

Following the US-Israeli attack on Iran on 28 February, oil prices have risen rapidly. By 23 March, average EU pump prices had reached €2.06 per litre for diesel and €1.89 per litre for petrol – an increase of €0.49 and €0.27, respectively. Filling a 55-litre diesel tank now costs almost €27 more than it did before the conflict began, and €15 more for a petrol car.

European diesel refining margins have outpaced other regions, reflecting a structural shortfall in domestic refining capacity. By contrast, petrol margins have been more subdued due to high inventories in the US and Europe, as well as weak seasonal demand. The EU remains more structurally dependent on diesel than petrol imports. With around 20% of Europe’s diesel imported, these excess profits will be made in non-EU jurisdictions, limiting the effectiveness of any EU-based windfall tax.

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