All the expectations are that Wall Street will dive this afternoon. What is spooking the markets is the thought of a painful and long-lasting depression. But in the middle of this turmoil the oil giants BP and Shell are set to announce record profits.
Estimates vary but between them, the two oil giants look set to unveil combined profits of somewhere between $14 and $22 billion for the three months to September. This means that together the companies were making over $10 million an hour. That’s a nice little earner.
This huge amount of money is likely to increase calls for an windfall energy tax and seems obscene when so many people are being clobbered by the credit crunch. It also comes days after UK Prime Minister, Gordon Brown, threatened to call in the regulators to investigate the oil companies for keeping fuel costs high even though the oil price is dropping fast.
And this means it is not all good news for the industry as the oil price has now more than halved since reaching a high of $147 a barrel in July to around $64 a barrel last week.
But the British unions are up in arms over the money. Tony Woodley, joint general secretary of the Unite union, described the oil giants’ profits as “eye-popping” and “immoral”. He said: “As families up and down the land wait in fear of the twin terrors of the cold and the fuel bill, it is time to put an end to this obscene profiteering.”
But the obscene profiteering is not over yet with Exxon and Chevron expected to post record profits later in the week. The bad times may be coming, but the good times are still now.