Chancellor Rachel Reeves will meet North Sea industry leaders today amid mounting geopolitical tensions and continued uncertainty over the future of the UK’s offshore sector.
Opening her Spring Statement yesterday, Reeves pointed to instability in the Middle East following US strikes on Iran and said the government would engage directly with the energy industry to address the implications.
“Tomorrow I will meet with our North Sea industry leaders to discuss the implications they face and work with them to manage this uncertain period,” she told MPs in the Commons.
“I am in no doubt about Britain’s ability to navigate the challenges we face.
“The plan that I have been driving forward since the election is the right one – stability in our public finances, investment in our infrastructure including our armed forces, and reform for Britain’s economy.”
However, the Spring Statement did not include any changes to the energy profits levy, which continues to draw criticism from industry and political figures concerned about its impact on investment and employment in the North Sea.
Meanwhile, Professor Paul de Leeuw, director of the Energy Transition Institute at Robert Gordon University, warned that delays in providing policy clarity risk undermining the UK’s long-term energy security.
“These are eventful times,” he told the P&J ahead of the meeting between Reeves and sector leaders.
The UK currently consumes around 2.5 million barrels of oil per day but produces roughly one million, leaving a significant reliance on imports.
“We are one-and-a-half million barrels of oil imported every single day,” he said.
“By not doing this in the North Sea, all we’re doing is shifting the demand, especially in the short term, to imports.”
Prof de Leeuw added: “There’s a risk by waiting too long, people just move on.”