Looney’s tune on windfall taxes is unpersuasive

theguardian.com:

BP’s best bet for avoiding a windfall tax might be to hide Bernard Looney on an offshore oil platform for a few months. Every time the chief executive ventures on to tax and investment territory, he inflames the politics around the windfall debate.

Looney’s memorable remark last November – one he must regret – was the boast about BP being “a cash machine at these types of prices”. Oil prices at the time were $85 a barrel, so the extra profits at $105 were bound to invite scrutiny when they flow, in the most part, from Russia’s war in Ukraine.

Then there was the admission a couple of weeks ago – repeated at Thursday’s shareholder meeting – that a windfall tax wouldn’t alter one jot BP’s plan to invest £18bn in the UK over the rest of the decade. That line invited outsiders to wonder whether BP could do more than £2bn-ish a year on average. The UK’s need to invest in energy security has become more urgent suddenly, so it’s fair to ask if BP has upped its ambition too. If any element of the £18bn represents a boost to previous plans, the company has not identified it.

In that context, another of Looney’s comments on Thursday read almost as an invitation to the government to have an arm-wrestle. “By definition, windfall taxes are unpredictable and could challenge investment in homegrown energy,” he said. Does that mean BP could invest more, but won’t if the government takes the windfall route? If that’s the pitch, Rishi Sunak, a chancellor who says he is in “pragmatic” mode, is almost obliged to emerge with a victory of some description from this little confrontation.

The weirdness in the whole debate, as pointed out here more than once, is that we’re not talking about huge sums. In BP’s case, an increase from 40% to 50% in the