‘Tax people in this room to help the poor’

European governments should tax corporates to help weaker parts of society weather soaring energy costs but not intervene to cap gas prices, Shell Chief Executive Officer Ben van Beurden told an energy conference on Tuesday.

Speaking before the Energy Intelligence Forum in London, Van Beurden said that 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.”

“One way or another there needs to be government intervention that somehow results in protecting the poorest,” Van Beurden said. “That probably may then mean that governments need to tax people in this room to pay for it.”

A Shell spokesperson later said that van Beurden was referring to companies and not individuals.

His comments come as governments across Europe grapple with how best to finance protection for consumers amid runaway energy prices largely stemming from Russia’s invasion of Ukraine.

European Union countries last week approved emergency levies on energy firms’ windfall profits. Britain in May introduced a windfall tax on oil and gas producers, but chose to borrow rather than impose further levies to fund around 100 billion pounds of subsidies announced in September.

“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,” van Beurden said.

Van Beurden’s pay package reached $8.2 million in 2021 and could rise further in 2022 after Shell reported record profits in the second quarter of the year.

The veteran oil executive, who will step down at start of next year, said that European governments should not intervene in market exchanges in a bid to limit gas prices.

“Can we make a meaningful intervention in gas markets here in Europe? That is a much more challenging prospect,” he said. “The solution should not be government intervention but protection of those who need protection.”

Van Beurden also said that he “struggled” to see how a price cap on Russian oil, which is being discussed among Western governments, would work.