The chief executive of Shell has said governments may need to tax energy companies to fund efforts to protect the “poorest” people from soaring bills.
Ben van Beurden, the outgoing boss of the oil and gas company, told an energy conference in London: “One way or another there needs to be government intervention. Protecting the poorest, that probably may then mean that governments need to tax people in this room to pay for it.
“I think we just have to accept as a society – it can be done smartly and not so smartly. There is a discussion to be had about it but I think it’s inevitable.”
Last week EU ministers agreed to tap windfall profits of companies and redirect them to customers and businesses as part of an initial energy package. The EU executive hopes to raise €140bn (£121bn) through the levies. The bloc also set a goal to reduce power consumption.
Earlier this year the former chancellor Rishi Sunak announced a windfall tax on North Sea oil and gas operators in an effort to raise £5bn. However, Liz Truss has so far refused to extend this to power generators despite needing to fund her energy price guarantee, which limits bills.
The EU has also discussed capping the price of natural gas and power in a bid to protect consumers. Van Beurden said this may hamper efforts to bring more gas into Europe, as the countries attempt to replace a shortfall in Russian gas after the invasion of Ukraine.
He told the Energy Intelligence Forum: “We will do our best to bring gas to Europe where it’s needed, but if the market signal is not there it’s going to be really challenging.
“Can we make a meaningful intervention in gas markets here in Europe? That is a much more challenging prospect. The solution should not be government intervention but protection of those who need protection.”
The Dutchman, whose pay package reached $8.2m (£7.2m) in 2021, will step down at start of next year to be replaced by Wael Sawan. He has already predicted that European gas shortages are likely to last for several winters.
Van Beurden said he “struggled” to see how a price cap on Russian oil, which is being examined by western governments, would work.
He also said European energy prices and the huge volatility in the markets threatened broader social instability. “You cannot have a market that behaves in such a way … that is going to damage a significant part of society,” he added.
