πŸ›’ Barrels of profits

In today's email:

  • Get our commercial awareness guide

  • Are oil companies making too much money?

  • Law firm lay offs

  • Are NFTs art?

  • Win a free MacBook (and Β£2,000 worth of gifts)

If you take just one thing from this email...

One of the knock-on effects of the war in Ukraine has been an increase in oil prices. This is because Russia was a huge oil exporter and now fewer countries want to deal with them. But oil companies like BP and Shell have profited hugely from these price rises. There are calls for the UK to tax them really highly on these profits but they say if the taxes get too high, they'll just move elsewhere.

EDITOR'S RAMBLE πŸ—£

Hey gang!

Last week you might have noticed something new in the newsletter... we've now got a referral scheme! πŸ₯³

From when it launched, LittleLaw used to run mostly as a group of social media pages on Instagram, LinkedIn and Facebook.

Since last year we switched to focus on our email newsletter instead (we still have the social pages but you only get some of the content there).

The change has helped create a much better product. But it's made it harder to build our readership because email newsletters don't get recommended to people automatically the way social media pages do.

The referral scheme helps achieve our goal of reaching more aspiring lawyers while giving something back to you.

So, if you want to help us out and grab yourself access to our complete commercial awareness guide too, scroll down to the 'Share LittleLaw' section and and send your unique referral link to a few mates (hint: drop it in a forum, community or group chat to rack up the numbers more easily).

- Idin

FEATURED REPORT πŸ“°

πŸ›’ Barrels of profits

Credit: Giphy

What's going on here?

Big oil companies like BP, Shell, ExxonMobil, and Equinor, have announced huge profit figures.

What's caused this?

The massive profits are mainly because of the rise in the price of oil and gas.

Due to the war in Ukraine, many countries stopped buying oil from Russia, which was a huge exporter of oil. This simulated a reduced supply of oil.

Also, following the opening up of, well, everything in the world after the pandemic, there's been an increase in demand for oil.

As with anything, if supply goes down and demand goes up, the price will increase.

What's the problem?

While oil companies rake in big profits, normal people around the world are struggling to pay their energy bills and fill up their cars.

The high oil price has also put a strain on businesses (especially oil-heavy ones like farming and agriculture).

Because of this situation we're in, many people are calling for higher taxes on oil companies.

How are oil companies taxed?

Oil companies in the UK pay a 40% tax on their profits (this is more than other companies pay). Their mega profits were recorded in spite of the billions of pounds in taxes they already pay to governments everywhere.

However in years before where they've struggled, companies like BP and Shell didn't pay any taxes and even sometimes received payments from the government.

Should oil companies pay more tax?

As it became clear that oil companies were benefitting from the increased oil price, there were calls for these companies to pay a 'windfall tax' - a tax on their sudden large profit.

This 25% tax was introduced in May 2022 and it was then raised to 35% in November 2022.

But is that enough? Some people are saying no - they should be taxed even more as it's not fair for them to profit from the suffering of people in a war.

Tax revenues could then potentially be used to help those suffering most from the cost of living crisis.

But oil companies warn that if windfall taxes keep rising, they'll just move their headquarters out of the UK to places where taxes are lower.

Why should law firms care about this?

These large UK oil and gas companies work with 'panels' of many law firms.

For example, if we look at BP alone, in the past they've worked with: Ashurst, Addleshaw Goddard, CMS, Dentons, Holman Fenwick Willan, Pinsent Masons, Simmons & Simmons and litigation boutique Three Crowns.

BP will use each of these 'panel firms' for different types of work according to their specialities. Or, they might invite the firms to pitch to them on how they would help them solve a specific business issue before picking their favourite one.

Commercial law firms should care because so many of them act for oil and gas companies. If their clients are bringing in higher profits, this could result in more work coming in as the companies engage in new projects.

Also, as the tax laws keep getting changed again and again, the companies may need advice on navigating these in the most efficient way possible.

A BIT OF FUN πŸ˜„

Trust us... it'll be okay πŸ₯΄

Credit: Fishbowl

IN OTHER NEWS πŸ—ž

  • βœ‚οΈ Law firms are starting to cut their staff numbers in the US:Β Shearman & Sterling cut 38 staff and they're not the first US firm to do so - Goodwin Procter and Cooley also reduced their staff numbers.

  • 🎨 Fashion company Hermes sued an American artist over NFT handbags for $130,000: The artist made NFT 'tributes' to the fashion brand, but they didn't like them at all. They thought the work caused confusion that the NFTs were affiliated with Hermes (they were not).

  • πŸ“‰ Google's AI made a factual mistake in the demo which caused an 8% drop in its share price: In a demo of Google's new AI product called Bard, it confidently said that the James Webb Space Telescope snapped β€œthe very first image of a planet outside our solar system” - this is completely wrong.

AROUND THE WEB 🌐

  • πŸ€‘ Prizes: The law firm CMS is running an amazing giveaway worth Β£2,000 - you can even get a MacBook among other gifts! (this isn't sponsored - just thought this was really cool).

  • ❌ No-go: When planning your next trip, it's useful to know where not to go. Here's a list of places not to travel to in 2023, according to travel magazine Fodor.

  • πŸ›Œ Dreamy: If you've ever had a dream and wanted to know what it means, this site interprets your dreams using AI.

STUFF THAT MIGHT HELP YOU πŸ‘Œ

  • πŸ‘₯ Community for aspiring lawyers: If you're struggling with motivation for law firm applications, check out FlowHuddle - a supportive online community, hosting remote co-working sessions, expert office hours and in-person meet-ups.

  • πŸ“•Commercial awareness journal: Check out this journal that we've created alongside the team from The Lawyer Spot. It gives your a simple three-step structure to improve your commercial awareness in a high-quality physical notebook.

  • πŸ“£ Advertise with us: If you're looking to reach an engaged audience of over 6,000 aspiring lawyers, sponsor this newsletter.

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