SNP government, shielded from reality by Westminster funds, is playing a dangerous game with North Sea oil that could leave UK reliant on energy imports – Dr Azeem Ibrahim

If fossil fuels are to be ditched, fundamental questions must be answered about issues such as battery capacity to support a renewable electricity network and gas-free home heating

The SNP's stance on the North Sea oil issue highlights a stark disconnect between grandstanding politics and the hard realities of managing a nation's economy. In the face of escalating global energy prices – a direct fallout from last year’s Ukraine invasion oil crisis – the SNP showed themselves to be fundamentally unprepared to take the unpopular but necessary decisions. Their opposition to drilling North Sea oil strikes a devastating long-term blow to Scotland's economy and, more fundamentally, undermines their credibility as would-be leaders of an independent state.

This ongoing miscalculation reveals a deeper problem at the heart of devolution: the SNP, under the Barnett formula, operates without financial accountability. They receive a fixed amount regardless of their policies, enabling them to pursue populist measures with little regard for economic fallout. It encourages a dangerous game of smoke and mirrors where competence is made to play second fiddle to the SNP’s pursuit of green virtue-point-scoring.

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The SNP's handling of the COP26 climate summit further underscores their preference for optics over substance. Nicola Sturgeon's continuous presence there, her unabashed chasing of selfies with global leaders, while pressing domestic issues remained unattended, reflects an administration more preoccupied with image than actual governance. This was at a moment when Scotland's economy was hanging by a thread, Covid cases were rising, and the threat of widespread industrial action loomed large.

Yet somehow the SNP's U-turn on North Sea oil has gone unnoticed by their supporters. A party that once championed "maximum extraction" of fossil fuels now paints itself as a green crusader. “Scotland’s oil” had been the SNP’s main rallying cry since the 1970s. The unsettling insincerity behind such a volte-face does, however, have tactical electoral value. Sheltered from consequences of decision-making, they have lulled their supporters into a kind of cognitive dissonance; a belief that Scotland is mysteriously able to earn revenue from oil they won’t be drilling. They can have their omelette without breaking any eggs.

Labour, unfortunately, seems to be joining the bandwagon. Their plan to block new North Sea oil and gas exploration reflects the same incoherence as the SNP's. Reducing our own extraction cannot, by the sheer force of good intentions, reduce the need for oil and gas for British consumers and industrial production. Labour policy will, instead, needlessly lead Britain down a path of near-total dependency on foreign energy imports, exposing us to the precariousness of global energy dynamics and price volatility, and help impoverish Scotland in the process.

Tory MSP Stephen Kerr told the Daily Mail that Keir Starmer, ahead of his recent visit to Edinburgh, “will apparently come to Scotland to tell us how he's going to shut down North Sea Oil and make us dependent on foreign imports, at the cost of tens of thousands of NE Scotland jobs”; a former director-general of the British Chambers of Commerce, John Longworth, concluded it would leave us as a “backwater paying over the odds for imported gas”.

We can see how Labour too have mastered the art of giving one message to their party’s left and another to the centrists. Anas Sarwar has insisted there was “no suggestion” Labour would be shutting down North Sea production – despite plans to reject licences for the Rosebank and Cambo oilfields. Sunak’s government, by contrast, has emphasised the importance of Britain's reliance on its own fossil fuel resources for the foreseeable future, and has promised more investment and exploration licences, making the most of Scotland’s natural resources while they remain viable. But these investments are not taking place at anywhere near the rate they should be, because businesses have no confidence he will be in power long enough for those investments to come good.

With Starmer’s likely victory next year, he plans to borrow exclusively for green enterprises, promising to significantly ramp up wind and solar power. Labour claims that their plans could generate up to half a million jobs in the renewables industry, including at least 50,000 in Scotland, but shows total disregard for the 200,000 currently employed in the UK oil-and-gas sector. Craig MacKinlay, leader of the Net Zero Scrutiny Group of Conservative MPs, has argued the policy could easily be self-defeating, with imported LNG required to heat homes and imported oil to fuel our cars having a higher carbon footprint than would domestically drilled oil and gas, due to transport costs and lower production standards.

Sound leadership means translating the fickle and contradictory web of public sentiment into a policy programme that delivers on the most fundamental priorities of the electorate. The fundamental laws of politics, however, encourage opposition parties – and devolved governments – to be opportunistic rather than take wider responsibility for issues of public policy.

What would a more responsible and mature policy proposal look like? For a start, the country must address the root causes for why investment in green technology is lower than Starmer would like. Those reasons include high taxes and tough regulations on innovating businesses, such that investors almost unanimously prefer to set up in the USA. And high energy prices brought about by exactly the kind of short-term populism embodied by Sturgeonism. And a punishing web of personal taxes, at the highest level since the Second World War, meaning the most discerning investors with the most innovative ideas would be quite mad to choose the UK.

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Such a policy platform must also address the most glaring flaws in its own coherence. Where will the battery capacity to support a renewable network come from? How will houses and infrastructure be changed to no longer require gas for energy? Until the very most basic questions have been given believable and affordable answers, Scotland must be allowed to drill the North Sea oil, or else the whole country will find itself chronically cash and energy poor.

Dr Azeem Ibrahim is the founder and executive chair of the Scotland Institute and director of the New Lines Institute for Strategy and Policy



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