The UK's oil and gas industry has warned that up to 30,000 jobs could be lost as a result of the coronavirus pandemic and the collapse in global oil prices. The sector, which employs around 151,000 people directly or indirectly, says many firms are struggling to survive.
A global oversupply of oil has pushed Brent Crude prices to their lowest level in 20 years, falling as low as $16 a barrel in recent weeks. The industry fears the downturn will outlast the Covid-19 crisis, leading to workers being laid off rather than furloughed. Some redundancies have already been announced, with many more expected in the coming months.
Oil and Gas UK (OGUK), the industry body, conducted a survey of its members and has called for the transition to net-zero greenhouse gas emissions to be placed at the heart of a recovery plan. Chief executive Deirdre Michie said: "With historic low oil and gas prices coming so soon after one of the most severe downturns our sector has experienced, these findings confirm an especially bleak outlook for the UK's oil and gas industry." She added that the industry is "worth fighting for" to maintain domestic energy supply and build critical infrastructure.
Green groups, however, insist that any government support must come with conditions. Ryan Morrison from Friends of the Earth Scotland warned that returning to "business as usual" would "lock in another crisis" and said workers should not be treated as a tap that can be turned on and off. About 30% of firms reported securing funding through government Covid-19 packages.
Capital expenditure is expected to fall to around £3.5bn, one of the lowest figures since North Sea oil was discovered, while drilling activity is projected to halve compared with 2019, reaching record low levels.
