Despite energy price inflation punishing households and businesses, Nicola Sturgeon is stacking the deck against oil and gas.

Scotland’s net fiscal balance (difference between total revenue and total public sector expenditure including capital investment) was a deficit of 22.4% of GDP. That is £36.3bn for 2020-21, and is including North Sea revenues. For the UK the net fiscal balance was a deficit of 14.2% of GDP1

With all of these economic facts in mind it is a true mystery why our First Minister has set her face against new north sea oil and gas exploration and development. Especially given oil prices rising to $100 a barrel (£83)2. Expanding the Scottish oil and gas industry at this time would ease if not transform our current economic woes as seen above. Assuming no asymmetric shocks that would lower oil prices, we could expect this oil price boom to continue through to the end of the 2020s.

Yet, despite the pressing economic need to transform our notional deficit and our appalling net fiscal balance, still the SNP and Scottish ‘Green’ Parties refuse to play our economic ace-card.

In recent decades North Sea revenues are dwindling, and the SNP government seem bizarrely fine with speeding this process up. The Scottish Government opposition to new oil and gas development and production risks jobs, and by doing so undermines our ability to make a just transition to renewables. Fact is, Scotland needs to maximise the economic gains from North Sea oil and gas, and then leverage this to aid the renewables energy sector growth. But this is not what Nicola Sturgeon’s government is doing.

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