North Sea Gas Shutdown Drives UK to Record Imports as Windfall Taxes Bite

The United Kingdom faces a surge in gas imports after a sharp decline in North Sea production triggered by Energy Secretary Ed Miliband’s policies. Official government data published this week reveal imports of gas soared by 20 per cent between January and March as North Sea output suffered a nearly seven per cent fall in the same period. These figures reflect the impact of rising windfall taxes on oil and gas profits, coupled with a fresh ban on new drilling licences in British waters.

Demand for gas remains robust despite these restrictions. Consumption leapt by 8.5 per cent in early 2025, driven largely by plummeting winter temperatures and the consequent need to fire up gas-powered stations to stabilise the nation’s energy grid. Shadow Energy Secretary Claire Coutinho cautioned that Labour’s rapid withdrawal from North Sea production could prove economically disastrous, potentially leaving the UK heavily dependent on foreign gas for decades to come.

The industry itself has warned of significant supply challenges. Offshore Energies UK, representing the sector, estimated that around 180 out of 280 British oil and gas fields may close by 2030. Mike Tholen, a spokesman, emphasised the importance of a balanced and diverse energy system, as wind power—while increasing—suffers from notable intermittency. During the first quarter, wind output dropped by 13 per cent due to unusually calm weather, resulting in gas generating 38.1 per cent of total electricity, versus just 28.5 per cent from wind. At one point, persistently low wind speeds brought the grid close to blackout conditions.

The policy has proven politically divisive. The US President recently condemned the UK’s aggressive taxation and drilling bans, calling North Sea oil a “treasure chest” now rendered unattractive to investors. UK government spokespeople, by contrast, champion the country’s historic investment in clean energy, aiming to phase out reliance on volatile fossil fuel markets and replace imports with domestically generated power.

Majority of the UK’s increased gas imports arrive from Norway, the United States and Qatar. Norwegian supply is delivered via undersea pipelines, whilst imports from other regions come in liquefied natural gas shipments. Industry analysts and campaigners for renewables note that the UK largely exploited its North Sea boom during the 1980s and 1990s, making today’s reserves insufficient for long-term needs. To avoid spiralling import costs, experts say Britain must prioritise expansion of its wind and other homegrown renewable resources.

For now, the confluence of declining domestic production, reduced wind supply and ongoing high demand has cast doubts over the feasibility of an abrupt energy transition. As the North Sea’s future is wound down, Britain faces difficult choices over energy security, pricing and long-term policy.