A new report by the charities Oxfam and ActionAid has revealed that the 722 largest companies in the world are making over $1 trillion per year in windfall profits as energy prices soar and interest rates rise.
The corporations examined made $1.09 trillion in windfall profits in 2021 and $1.1 trillion in 2022, increasing average profits from the years 2017-2020 by 89%, according to an analysis of the Forbes Global 2000 rankings. Published on Thursday, the study defined the term windfall profits as any profits which exceeded average profits earned in the years of 2017 to 2020 by over 10%.
The report pointed out that over the previous two years, 45 energy firms generated an average of $237 billion per year in windfall profits. The report went on to note that there are now 96 energy billionaires whose combined wealth totals $432 billion, which is $50 billion above what they had accumulated as of April of 2022.
The report points out that the cost of living crisis being produced by the rampant inflation and high energy prices has proven profitable to various other companies as well. Food and beverage corporations, banks, pharmaceutical companies, major retailers, and aerospace and defense companies have all enjoyed banner earnings as more than a quarter of a billion people throughout 58 countries experienced acute food insecurity.
The report went on to explain that extreme wealth and extreme poverty have both been increasing simultaneously for the first time in 25 years. As corporate profits have soared, pay conditions for workers have been steadily degrading.
Amitabh Behar, International interim Executive Director at Oxfam noted, “People are sick and tired of corporate greed. It’s obscene that corporations have raked in billions of dollars in extraordinary windfall profits while people everywhere are struggling to afford enough food or basics like medicine and heating.”
He added, “Big business is gaslighting us all —they’re hiking prices to make monster profits, plundering people under the cover of a polycrisis.”
The report emphasized that the profiteering by corporations, is playing a “significant role in supercharging inflation, echoing fears that corporations are exploiting the cost-of-living crisis to boost profits margins,” in what has been called, ‘greedflation’ and ‘excuseflation.’
