London: The oil and gas industry has delivered $2.8 billion a day in pure profit for the last 50 years, a new analysis has revealed, The Guardian reported.
The vast total captured by the petrostates and fossil fuel companies since 1970 is $52 trillion, providing the power to “buy every politician, every system” and delay action on the climate crisis, said Professor Aviel Verbruggen, the author of the analysis. The huge profits were inflated by cartels of countries artificially restricting supply.
The analysis, based on World Bank data, assesses the “rent” secured by global oil and gas sales, which is the economic term for the unearned profit produced after the total cost of production has been deducted, The Guardian reported.
The study is yet to be published in an academic journal, but three experts at the University College London, the London School of Economics and the thinktank Carbon Tracker confirmed the analysis as accurate, with one calling the total a “staggering number”.
It appears to be the first long-term assessment of the sector’s total profits, with oil rents providing 86 per cent of the total.
“I was really surprised by such high numbers — they are enormous,” said Verbruggen, an energy and environmental economist at the University of Antwerp, Belgium, and a former lead author of an intergovernmental panel on climate change report.
“It’s a huge amount of money. You can buy every politician, every system with all this money, and I think this happened. It protects [producers] from political interference that may limit their activities,” he said.
The rents captured by exploiting the natural resources are unearned, Verbruggen said, adding, “It’s real, pure profit. They captured 1% of all the wealth in the world without doing anything for it.”
The average annual profit from 1970-2020 was $1 trillion but he said he expected this to be twice as high in 2022, The Guardian reported.