North Sea Oil Jobs Crisis Deepens Amid Labour Policy Row

Fresh warnings have emerged over the future of the North Sea oil and gas sector, as Labour’s approach to exploration licensing has sparked division and concern among politicians, industry bodies, and trade unions. The Commons Scottish Affairs Committee has demanded a more pragmatic policy, with concerns mounting that existing plans could accelerate catastrophic job losses before viable alternatives are in place.

Offshore Energies UK (OEUK) has forecast that up to a thousand oil and gas jobs may be lost every month until the end of this decade. Although North Sea oil production has declined by seventy-five per cent since its peak in 1999, the sector still meets sixty per cent of the UK’s oil requirements and half of its gas demand. The industry contributed £25 billion to the UK economy in 2023 and currently supports an estimated 115,000 jobs, with two-thirds located in Scotland. However, the sector has already shed around 75,000 positions since 2016, and the pace is quickening.

The parliamentary committee report, published in advance of the Chancellor’s forthcoming Budget, has called for moderation in the planned production decline, arguing that domestic supply yields stronger economic returns, lower emissions than imported alternatives, and secures vital skills and energy security. The report notes that the so-called scale-up of green energy employment is not keeping pace with losses from oil and gas, and highlights that new renewables roles often offer lower wages.

Labour’s pledge not to award new North Sea licences has come under pressure, with Ed Miliband, the Energy Secretary, facing calls to refine the policy and permit ‘tie-back’ developments on existing fields. Sir Keir Starmer has indicated that oil and gas will remain integral to the UK’s energy mix for the foreseeable future, yet Scottish Labour and others are asking him to go further, fearing political consequences ahead of elections in Holyrood.

The committee’s Labour chair, Patricia Ferguson, has stressed that neither UK nor Scottish policy measures have delivered on promises to ensure a smooth energy transition for oil and gas workers. She urged government not to accelerate the industry’s decline before sufficient new jobs and retraining are established. Recent closure of the Grangemouth refinery was cited as an ominous warning of what rapid withdrawal might mean for communities and skilled livelihoods.

Reducing reliance on domestic production, MPs concluded, risks undermining economic stability, losing valuable expertise, and exposing the UK to unreliable and higher-emission imports. OEUK has claimed that maintaining a favourable tax and regulatory climate could allow the North Sea to supply half the nation’s needs out to 2050, potentially adding £165 billion to the economy. The debate over the future of North Sea energy remains sharply contested, with unions, industry, and policy makers all demanding a firmer plan for workers and regions on the front line.