Rishi Sunak has refused to rule out extending the windfall tax on the profits of oil and gas companies, insisting he would not comment on "speculation" ahead of the Budget.

However, the Prime Minister insisted the Conservatives “have consistently been the only major party that has backed the North Sea oil and gas industry”.

It follows reports that Chancellor Jeremy Hunt is mulling a possible extension as part of his March 6 Spring Budget.

Picture: Andy Buchanan - WPA Pool/Getty Images

Mr Sunak introduced the Energy Profits Levy in 2022, when he was chancellor under Boris Johnson.

Industry leaders have strongly criticised plans by Labour to extend and increase the tax, insisting it could wipe out tens of thousands of jobs.

Russell Borthwick, chief executive of Aberdeen and Grampian Chamber of Commerce, said “jungle drums” around a Treasury extension to the windfall tax were “deeply unhelpful”.

Speaking to journalists at the Scottish Conservative conference in Aberdeen, Mr Sunak said: "I'm sure you and everyone else will understand why it wouldn't be appropriate for me to comment on any speculation or fiscal policy ahead of the Budget.

"But what I can say is we have consistently been the only major party that has backed the North Sea oil and gas industry, and you can see that most recently with the move to annual licensing which we're legislation for, opposed by everybody else.

"The reason we're doing that is because our country is going to need oil and gas for decades to come, and my view and our government's view is it is right to get that from here at home, and that means the North Sea. Good for our energy security, good for our economy and good for British jobs, including Scottish jobs."

Pushed on whether he is ruling out extending the windfall tax, he said: "I wouldn't read anything into what I said, other than it's never appropriate, and I think everyone understands that, for the Prime Minister, the Chancellor, or anyone, to comment on any speculation in advance of the Budget."

Elsewhere, Mr Sunak insisted it was only the Tories who would protect jobs in the North Sea energy sector. He said the SNP, with their “Green allies”, would “destroy” the oil and gas sector.

On Labour, he said: “They don’t want to ban all oil and gas, they just want to ban British oil and gas with their ban on North Sea exploration. It shows so clearly that their values are not our country’s values, that they put virtue signalling ahead of our country’s energy security.”

He accused Sir Keir Starmer and his party of being “blinded by their own zeal on this issue”, saying that Labour’s U-turn on a pledge to spend £28 billion on green energy would mean higher costs for households.

Criticising his rivals, Mr Sunak said: “They dropped the policy, but it turned out they kept the policy but just wanted to drop the price tag. We all know what that means – it means higher taxes and higher energy bills. That’s what we have to stop.”

But with the Prime Minister’s address to the conference only lasting just over 10 minutes, the SNP branded it a “blink and you’d miss it” speech.

Rishi Sunak refuses to comment on ‘speculation’ over extending oil and gas windfall tax

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