The UK’s oil and gas sector plays a pivotal role in supporting over 200,000 jobs and contributing significantly to the country’s economy. Offshore Energies UK’s (OEUK) latest economic report reveals the substantial impact of domestic oil and gas activity on employment and economic growth.
In 2022, the industry supported approximately 220,000 jobs, with 133,000 of these being direct and indirect roles within oil and gas companies and the supply chain. OEUK’s report highlights the interdependence of the oil and gas sector with various industries, with 36 sectors contributing to indirect job creation, including construction, steel manufacturing, transport, catering, and professional services.
The sector’s influence extends beyond traditional hubs, with 86,000 induced jobs in regional economies benefiting from the oil and gas sector’s presence. Scotland leads with 93,600 jobs supported, followed by London (25,100), the South East (18,800), the North West (14,400), and the East of England (12,800).
In terms of economic contribution, the oil and gas industry generated nearly $37.3 billion (GBP 30 billion) in gross value added (GVA) in 2022. Over $28.6 billion (GBP 23 billion) of this value was directly and indirectly generated by oil and gas companies and the supply chain, with an additional $7.4 billion (GBP 6 billion) induced by community activities supported by the sector.
OEUK emphasizes the sector’s productivity, with every $1.25 (GBP 1.00) of oil and gas expenditure resulting in $2.87 (GBP 2.30) in value-added across the economy. This productivity underscores the sector’s role in stimulating economic growth and supporting the UK’s overall economic health.
David Whitehouse, CEO of OEUK, highlights the sector’s historical significance in powering the UK and its ongoing commitment to sustainability. The industry’s transition towards aligning with the UK’s net zero ambition is evident, with efforts to reduce emissions and embrace renewable energy sources.
The North Sea Transition Authority (NSTA) reports a consistent reduction in greenhouse gas emissions from UK offshore oil and gas production, aligning with targets set in the North Sea Transition Deal. The industry’s progress towards emission reduction goals demonstrates a commitment to sustainability and environmental responsibility.
Looking ahead, the oil and gas sector remains a crucial component of the UK’s energy mix, with plans to continue providing energy security while reducing carbon footprint. Investments in sustainable production methods are essential to meeting emission reduction targets and building a low-carbon energy future.
As the industry evolves, collaboration between oil and gas and renewable energy sectors becomes increasingly important. The transition towards cleaner energy sources requires strategic investments and long-term energy policies to drive significant progress towards emission reduction goals and achieving net zero by 2050.
In conclusion, the UK’s oil and gas sector’s impact on jobs, the economy, and environmental sustainability underscores its vital role in the country’s energy landscape. Continued efforts towards sustainability, innovation, and collaboration will be key in shaping a more resilient and environmentally conscious energy sector for the future.
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