- “The United Kingdom is the largest producer of oil and the second-largest producer of natural gas in the European Union. Following years of exports of both fuels, the UK became a net importer of natural gas and crude oil in 2004 and 2005, respectively.
- Although aggressive targets for renewable energy are in place, oil remains important to the UK energy balance, with oil contributing 38 percent of total energy consumption.
Recent increases in tax rates for the oil and gas sector, coupled with technical issues, have contributed to sharp declines in UK oil production. Higher tax rates have made the UK fields less competitive, which were already strained by high operating and decommissioning costs.
- Although a number of new fields are expected to come online in 2013, UK production will continue to decline as new production will not be sufficient to offset the declines.
- Once a major exporter of oil, the UK exports have dropped in tandem with decreasing domestic production.”