by Darwin Friend, head of research
“Drill baby drill”, the phrase popularised by Donald Trump for producing more oil and gas, has spread across the globe. And it’s clear it's spread here too, with Kemi Badenoch’s call to get “all our oil and gas out of the North Sea”. You can see why. Britain is sitting on a fortune beneath the North Sea, with billions of barrels of oil and vast reserves of gas still ready to be tapped. Yet instead of making the most of it, politicians of all stripes have shackled the industry with punitive taxes, knee-jerk levies and endless moving of the goalposts. For ordinary taxpayers that means higher bills, fewer jobs and more dependence on imports to keep the lights on.
We cannot keep pretending that Britain can simply switch off fossil fuels and run the economy on wind turbines alone. Every hospital, every school, every factory still depends on oil and gas in some form, and will for decades to come. The fantasy of an instant transition only succeeds in exporting our carbon footprint while importing energy at a higher cost. Shipping in gas from the other side of the world, after closing down refineries like Grangemouth, is not just absurd, it’s economic self-harm.
Meanwhile, look at Norway. Our neighbours across the North Sea continue to drill aggressively for oil and gas and recently found one of the biggest oil fields in a decade, all while simultaneously investing in clean energy. It is a contradictory approach, yes, but one that stems from a clear desire to protect their wealth and maintain their influence in the global energy market. They understand what Britain’s politicians don’t: that secure domestic energy is the foundation of prosperity, and that you can build a transition only if you have the resources to pay for it. Norway gets richer, more powerful, and more secure while we dither and drive out investment.
The root of the problem is a tax regime designed to squeeze producers dry. With a staggering 78 per cent headline rate, the North Sea is one of the least attractive places in the world to invest. The so-called Energy Profits Levy, a windfall tax introduced in 2022, was meant to be temporary, but like every “temporary” tax in British history, it has been extended again and again, now running until 2030. Investors have got the message: Britain can’t be trusted. And when investment flees, the rigs close, the jobs vanish, and the revenue stream dries up. Who pays the price? Taxpayers.
It doesn’t have to be this way. Scrap the arbitrary levy extensions. Set a clear and final end date and stick to it - the sooner the better. Cut the surcharge so that Britain is once again competitive, and restore the allowances that encourage new drilling and fresh investment. If reliefs are linked to activity such as bringing new projects online, creating jobs and backing cleaner technology, then taxpayers get the best of both worlds: energy security and economic growth, funded by an industry that is thriving rather than throttled.
The benefits are obvious. Greater domestic supply means fewer price shocks when global markets go haywire. A stronger North Sea industry means high-skilled jobs in Britain rather than abroad. And a stable tax regime means a steady stream of revenue, not the boom-and-bust cycle of knee-jerk raids. All this while still giving the industry incentives to invest in carbon capture, hydrogen and offshore wind. A balanced approach to the transition instead of a reckless rush.
The truth is simple. Britain has the resources, the expertise and the choice. What it lacks is political will. Instead of clobbering producers with short-term gimmicks, ministers should be bold enough to say it: drill baby drill. Taxpayers deserve energy security, lower bills and growth at home, not dependence on imports and endless broken promises.