Greg Jackson urges Labour to exploit North Sea oil as UK ‘stares down barrel’ of energy price shock
Octopus founder and government adviser Greg Jackson has urged Labour to “use what’s available” in the North Sea and rethink its key net zero policies.
Jackson said the county was “staring down the barrel” of an energy price shock in light of the conflict in the Middle East.
The Octopus chief executive who is also a member of the industrial strategy advisory council and has shared close ties with key government figures including business secretary Peter Kyle, warned “economic damage” from the crisis was imminent.
He called on the UK government to ditch “wishful thinking” and “ideology” in order to keep prices stable and the economy afloat.
“Global gas prices have doubled since Iran effectively closed the Strait of Hormuz, and UK wholesale electricity prices are up about 50pc,” Jackson wrote in The Telegraph.
“Hikes in energy prices are bad enough, but they feed through to inflation, which in turn raises interest rates, compounding the economic damage.”
He added: “We should use what’s available from the North Sea. While the price is set globally, there’s no point shipping gas from the other side of the world when we have it here.
Jackson also suggested that subsidy costs and “expensive distractions” including carbon capture and hydrogen projects should be stripped from energy bills.
His intervention adds to the pressure on energy secretary Ed Miliband, who has pushed the government into doubling down on net zero efforts.
Calls for North Sea exploration grow
Opposition parties have pledged to remove restrictions on exploration in the North Sea while President Trump has pressed Sir Keir Starmer into easing taxes on energy giants operating in the area.
The Resolution Foundation warned that should recent rises in oil and gas prices stick, some £500 could be added onto energy bills later this year.
Reeves met executives from North Sea oil giants BP, Serica and TotalEnergies in London to discuss energy price rises, fuelling speculation the government could ease regulation on businesses to ease pressures on Britons.
It is understood the Chancellor said she would look to replace the energy profits levy with another tax mechanism based on revenue and market prices, as previously announced by the government.
She warned, however, that there was greater uncertainty over policy in the face of the conflict in the Middle East.
A government source said:”The Chancellor was clear with industry that she wants the energy profits levy to come to an end. She has made that promise and she stands by it. Indeed, it was a commitment she wanted to make this week. But the crisis in the Middle East has had real-time consequences on oil and gas prices and it is right that we respond to this.”
Starmer said during Prime Minister’s Questions that the “sprint” to decarbonise the electricity grid was more important to stop the UK from being over-reliant on international markets.