Why North Sea Drilling is not the answer to the energy crisis

The War in Iran and the effective closure of the Strait of Hormuz has triggered a global energy crisis, with oil and gas prices higher even than in 2022 following Russia’s invasion of Ukraine. Up to 20% of the world’s oil supplies are trapped in the Gulf, and import-dependent states are already beginning to feel the pressure. For UK businesses this is already translating into higher operating costs and increased uncertainty. Despite huge advances in renewable energy sources, gas still accounts for around a fifth of Europe’s energy consumption and has a dominant role in heating and industry.

The crisis highlights just how dependent many countries are on international energy markets, including the UK. This has led to some debate about more North Sea oil drilling, which 50 years ago supplied some of the UKs energy needs.

North Sea Drilling

The UK has been heavily reliant on fossil fuel imports for decades. Energy production across all energy types provides only 60% of UK demand, so imported oil and gas are imported to make up the gap.

This is because while the country has access to oil in the North Sea, the basin is ‘mature’, meaning production has been in decline for decades and newly discovered deposits are smaller and harder to reach. Offshore Energies UK found in 2024 that oil production had declined 36% in the last 4 years and natural gas by 14%. While oil and gas from these fields are still part of our energy mix, they are not a limitless asset and will eventually dry up.

This is why in November 2025 the Government chose to stop issuing new oil and gas exploration licenses. Oil and gas decline in our basin has led to nearly 450 jobs lost per week for over 10 years between 2010 and 2020 despite hundreds of new licenses during this time. Places like Aberdeen in Scotland have felt the brunt of this in their communities. While a new oil field may provide 1000 jobs, new energy industries which can generate thousands of new skilled UK jobs are a better investment. For trade unions and worker bodies, this highlights the importance of securing long-term, stable employment pathways.

Even if drilling resumes, oil and gas prices are determined by international markets based on global availability and production. The UK at full capacity was only ranked 20^th for oil and gas production, so it cannot impact global market prices. These international markets are why geopolitical shocks have such an impact in the UK. Between 2022 and 2024, when the effects of the Russian invasion first hit the market, the UK government spent more that £78 billion to protect consumers from unaffordable price spikes.

Increasing energy security

In times of crisis, energy is considered through the lens of national security, rather than longer-term climate goals which get deprioritised. This is also fuelled by Big Oil marketing: Clean Creatives analysed 1,859 campaign materials from BP, Chevron, ExxonMobil and Shell between 2020 and 2024 to identify the narrative shifts they follow. In 2020 when oil prices were low, many companies wrote net zero pledges and started investing in renewable energy. However, when prices spiked in 2022 and their profits soared, their messaging changed:

“BP’s oil and gas are essential for economic stability, is essential for daily life and national energy security”

Their analysis does not cover the war in Iran, but the same messaging is rising. In reality and contrary to Big Oil’s narrative, the only way to gain energy sovereignty and national security isn’t to invest into declining oil production, but into homegrown power that we can control.

The economic role of renewables

Energy secretary Ed Miliband has said that the biggest lesson from this crisis is that we need “home grown clean power”. Where gas and oil prices are controlled by global markets, and have subsequently raised 30% in the last month, new energy sources like solar and wind are domestically controlled. Because renewables cannot ‘run out’ the way fossil fuels do, their prices are stable and will only get cheaper as technology and up-take improves.

The UN says that this shows a “positive tipping point” where prices for renewable energy will only get cheaper. A recent study by the Oxford School of Rapid Analysis compared a ‘maximised’ North Sea oil and gas scenario with a renewable energy scenario. They calculated savings of £16 to £80 per household from North Sea revenue versus a £105 to £441 saving per household under renewables, depending on different levels of electrification. As well as personal savings, the UK would save billions from fossil fuel subsidies. For scale, in 2023, global fossil fuel subsidies amounted to $620 billion US, compared with $70 billion US for renewables - according to the UN.

The opportunity to scale domestic energy production

Achieving a strong domestic supply of renewable energy is the rational decision to make. Especially considering we have the infrastructure to be much less dependent on overseas energy: Offshore Energy UK says the UK has a highly capable offshore energy supply chain - it just needs investment to scale up. Effective subsidising and financing of heat pumps, solar panels and smart meters – especially for low-income households – could drastically improve household energy prices and reduce our dependency on volatile markets.

Figure 1: The graph from Carbon Brief shows how much imported gas could be avoided by different scenarios including North Sea drilling, or new wind and solar investments

In direct response to the war, Germany this week has approved an EUR-8-billion climate protection programme, encouraging renewable energy and industrial electrification to lower their dependence on fossil fuel. This will save around EUR 4.5billion annually from 2030 in energy imports, because their domestic supply will be larger.

Results clearly show that a switch to renewable energy is significantly more financially beneficial for households, alongside additional benefits of reducing carbon emissions and energy security. Times of global volatility only reinforce the case for developing a renewable energy led grid in the UK – without even taking climate goals into account, they are a solution to energy security risks. This is not to say that the UK needs to stop all existing drilling in the North Sea, but to be realistic about our declining basin and turn to the economically and practically viable solution of investing in green energy.

Practical takeaway

This crisis highlights vulnerabilities but also provides the opportunity to build resilience and adapt. Legislation and policy can build on that opportunity, by enabling electrification as well as clean power and heat generation across the country, exemplified by the recent announcement that government will increase plug-in solar availability. Policy can also drive demand for such clean energy e.g. through subsidies on electric vehicles.

Associations are uniquely suited to respond. This can be through encouraging uptake of renewable energy or sharing best practices on energy efficiency, or joining cross-industry efforts advocating for clean energy production and uptake. The transition to renewable energy will also create clear pathways for skilled green jobs and reskilling, and businesses can help advocate for subsidies and training to help adopt clean energy. CAFA provides guidance and support for member organisations and associations to help members make the transition.