BP earnings Q4 and FY 2022

Oil major BP on Tuesday reported record annual profits, more than doubling last year’s total as fossil fuel prices soared following Russia’s full-scale invasion of Ukraine.

The British energy giant posted underlying replacement cost profit, used as a proxy for net profit, of $27.7 billion for 2022. That compared with $12.8 billion for the previous year.

Analysts polled by Refinitiv had expected net profit of $27.6 billion for full-year 2022. BP said its previous annual profit record was $26.3 billion in 2008.

For the fourth quarter, BP posted net profit of $4.8 billion, narrowly beating analyst expectations of $4.7 billion.

Shares of BP are up 0.8% year-to-date.

The results see BP join Big Oil’s profit bonanza.

British rival Shell on Thursday posted its highest-ever annual profit of nearly $40 billion. Before that, U.S. oil giant Exxon Mobil reported a $56 billion profit for 2022, marking a historic high for the Western oil industry. Chevron‘s 2022 profits came in at a record $36.5 billion.

The West’s largest fossil fuel companies are expected to have raked in combined profits of almost $200 billion for the year, according to Refinitiv data. France’s TotalEnergies is slated to report full-year earnings on Wednesday.

The extraordinary scale of the earnings has renewed criticism of the oil and gas industry and sparked calls for higher taxes.

In recent quarters, Big Oil executives have sought to defend their rising profits and said the significant disruption to global energy markets due to the war in Ukraine has reaffirmed the importance of solving “the energy trilemma.”

According to a statement to investors from BP CEO Bernard Looney late last year, this refers to “secure, affordable and lower carbon energy.”

BP, which in 2020 set out its ambition to become a net zero company “by 2050 or sooner,” recently predicted that oil and gas would become a dramatically smaller part of the global energy mix by the middle of the century.

In its latest annual energy outlook, published on Jan. 30, the company said it sees the share of fossil fuels as a primary energy source falling from 80% in 2019 to between 55% and 20% by 2050. The share of renewables in primary energy, meanwhile, was projected to grow from 10% to between 35% and 65% over the same time period.

The wide range of outcomes reflects several possible paths for the energy transition. But in each of BP’s three scenarios, the pace with which renewables enter the global energy system is “quicker than any previous fuel in history,” the report said.

— CNBC’s Catherine Clifford contributed to this report.