According to news, the European Commission intends to force fossil fuel companies to "contribute" some of their excess profits generated by soaring energy prices, helping Europeans and multiple industries pay high energy bills, Reuters reported.
To help European countries ease the energy crisis, EU countries will require oil, gas, coal and related refining companies to participate in "solidarity donations" based on the basis of fiscal 2022 taxable excess profits 2022, according to the draft proposal.
The European Commission draft wrote that fossil fuel companies are "beyond expectations" and not normally available, so there is reason to ask them to "donate together". A Shell spokesman said: " We know that the EU has proposed 'solidarity donations' and are waiting for the European Commission to release further details."According to Reuters, the European Commission is expected to release the details of the proposal this week.
A special meeting of EU energy ministers was held in Brussels, Belgium, last week. Energy ministers in the 27 EU states agreed to develop emergency measures as soon as possible to ease rising energy prices. Since the outbreak of the Ukraine crisis, affected by the EU sanctions on Russia, the energy supply of Europe is tight, electricity and gas prices have soared, which has caused considerable pressure on the European inflation situation and the EU economy.
The emergency measures proposed by the European Commission include: coordinating EU member states to reduce electricity demand; setting a cap on revenues for low-cost power companies and levying profits from fossil fuel power companies; and developing emergency and temporary interventions, including considering price caps on natural gas.
The rapid recovery of oil and gas demand after the COVID-19 pandemic, the Ukraine crisis led to several rounds of Western economic sanctions on Russia, and soaring prices of fossil fuels such as oil and gas, soaring profits of large European energy companies. In the second quarter, for example, Total made a record $11.5 billion, London-based Shell $9.8 billion and BP $9.3 billion, its highest quarterly profit in 14 years and nearly triple the same of a year earlier. In addition, ExxonMobil reported a second-quarter net profit of $17.9 billion, nearly four times that of a year earlier. The five energy companies, including Chevron, earned more than $55 billion in the second quarter, the Washington Post reported.
The British government proposed in May imposing a "profiteering tax" on BP and its peers in order to finance the British government's plans to ease inflation, AFP reported. British consumers have been under pressure on the government amid a recent "cost of living crisis" due to the rise of electricity, gas and other energy prices.
