Offshore Energies UK’s (OEUK) Business Outlook report finds that nine out of 10 North Sea operators are cutting back investment citing a mix of high taxes, political climate and inflation as key factors in their decisions.
It follows the windfall taxes imposed on North Sea oil and gas operators, under which their overall tax rate has risen from 40 per cent to 75 per cent in the last 10 months. The taxes were put in place to try and mitigate soaring inflation and prices that have caused a cost-of-living crisis for many of the UK’s most impoverished households.
Fossil fuel extractors globally have announced record profits in recent months driven by high prices in the wake of the Ukraine war. Both BP and Shell have extensive operations in the North Sea and were subject to windfall taxes but have still reported massive rises in profits in recent months.
Offshore wind operators also face a similar windfall tax, rated at 45 per cent, which is expected to remain...