19/10/2026 by Joel Thompson
Trade body Offshore Energies (OEUK) has called for the Energy Profits Levy to be replaced with a new mechanism that is triggered by oil prices.
OEUK represents operators in the UK’s offshore energy industry. It claims that changing the levy and approving the Jackdaw and Rosebank projects will bring in investment of about £50 billion and unlock 111 projects. The UK North Sea is generally seen as an expensive place to produce oil and gas, and the Energy Profits Levy takes the marginal tax rate to 78%. This is generally seen as making it unattractive to invest in the industry. For example, UK-based oil major BP, the maker of Castrol metalworking products, recently put its North Sea operations up for sale.
The approval of the Jackdaw and Rosebank oil fields is controversial due the UK’s commitment to achieve net-zero emissions by 2050. Proponents, however, point out that oil and gas will be needed in the UK energy mix for years to come, and producing them domestically incurs fewer emissions. Simone Rossi, the boss of EDF, said to the BBC:
“It will take decades to wean off from that dependency. So, while this is happening, we should use the resources that we’ve got rather than importing them from afar. For me, it’s really a no-brainer. It is not in contradiction.”
Domestically produced natural gas can be transported over existing pipelines with minimal processing. Liquified natural gas (LNG), in contrast, is generally more expensive and emissions intensive because it has to be liquified, shipped long distances and re-gasified.
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