Thread by @tessakhan

Rishi Sunak just got the analysis of the causes of the energy price crisis right (i.e. our dependency on gas) but then proposed that the solution is more support for North Sea oil and gas companies.
This is deeply misjudged in so many ways. Let's count them! THREAD 🧵

1/ Gas is globally traded which means that increasing domestic production won't lower our bills. Prices here are determined by demand and supply dynamics all over the region/world, and North Sea oil & gas companies will sell their product to the highest bidder.

E.g. in September 2021 when gas prices were soaring in the UK, North Sea oil & gas companies exported a record amount of gas to Belgium where they could get a higher price. These are private companies acting in their own short-term interest--they're not here to help UK families!

2/What about oil you ask, given oil prices are also increasing? 80% of the oil produced domestically is exported. So much for UK oil helping UK households/the UK economy!

https://twitter.com/tessakhan/status/1461625761845104643

3/ So how is the industry good for the country, as Sunak claims? What about tax revenues given the eye-watering profits these companies are make?
Nope, the UK is the most profitable country in the world for big oil & gas projects precisely because we tax them so little

E.g. in Norway, the government receives $21 per barrel of oil, and in the UK the government receives less than $2. As a UK Court recently accepted, some oil & gas companies in the UK will pay NEGATIVE TAX over the course of their operations.

4/ What about jobs? Jobs in the industry can only be relied on when prices are high. When they fall, as they inevitably do given the volatility of fossil fuels, they disappear. E.g. more than 20,000 people in the industry lost their jobs in 2020.

Surveys of the workforce confirm that workers are keen for support to transition out of oil & gas. And research shows that with the right support there would be 3x as many jobs in renewables

5/ Oil & gas companies cannot be trusted to get us to net zero. Eg Shell, whose investment in UK renewables SHRUNK from 9% to 8.7% of its total spending bw 2018-19. Shell's profits today are being handed to shareholders, not to pay for the transition to cheaper renewables.

Also: ft.com/content/5c158a…

6/ CLIMATE CHANGE: The other huge reason we can't keep sinking £ into oil & gas extraction, which is the need to maintain a liveable climate. As the IEA head put it “If governments are serious about the climate crisis, there can be no new investments in oil, gas & coal, from now"

You can't get to net zero without dramatically reducing oil and gas production, a point @RishiSunak seems to have missed.
END.