UK should scrap oil rules to be best ally to US, says ambassador
Britain should scrap its ban on extracting new oil and gas from the North Sea if it wants to be “the best ally to the US it can possibly be”, Donald Trump’s ambassador to London has said.
Warren Stephens told Sky News that Ed Miliband was pursuing the “incorrect policy” by refusing to exploit North Sea oil and gas, and said the US president had directly raised the issue with Sir Keir Starmer.
Stephens said: “Energy costs are four times our electricity costs. Four times ours in the UK versus the US. And I want the UK economy to be as strong as it possibly can be so the UK can be the best ally to the US that it possibly can be.
Warren Stephens
THOMAS KRYCH/ZUMA/ALAMY
“And having a growing economy is essential to that, and the electricity costs make it very, very difficult. So, I hope that the UK will continue to examine the policies in the North Sea and frankly, make some changes to it, to allow for more drilling and more production, because you’re getting — you’re using — oil and gas but you’re importing it. Why not use your own?”
New oil and gas drilling is currently banned after pledges in Labour’s manifesto to not “issue new licences to explore new fields” in the North Sea. However last month it was reported this could be reversed after warnings from business and union bosses over the impact on the economy.
The government is due to outline its North Sea strategy before the budget on November 26.
The United States operates a pro-drilling policy
ALEX BRANDON/AP
Rachel Reeves is said to be considering removing the 5 per cent VAT charge on domestic energy bills, among other measures, having promised before the election to bring bills down by £300.
It comes as Nigel Topping, the chair of the Climate Change Committee, also said measures must be taken to bring down bills and Unite, the union, found households were paying £500 a year towards energy company profits.
He told the Laura Kuenssberg on Sunday programme: “Our number one piece of advice to governments for the last two years has been you’ve got to do something to bring the cost of electricity down relative to gas, so that that switch from a gas boiler system at the end of life to a heat pump delivers real economic benefit in terms of reducing the cost of heating your home.
“And if governments get that right, then we’ll see the market start to deliver clever tariffs and special offers, and we see a little bit of that already, but that’s what will really drive the massive uptake of heat pumps in the next 20 years.”
Research by Unite, released on Sunday, found that in 2024 energy companies made a total of £30 billion in pre-tax profits, equating to roughly £500 per household.
Sharon Graham, Unite general secretary, said: “What the Unite energy costs report clearly shows, is that households are being fleeced pure and simple.
“Energy bills up by 42 per cent since 2021, whilst energy companies made £30 billion profit in just one year. The government is turning a blind eye to these excessive profits. That must change. Everyday people cannot continue to pay.
“The chaos of the current system has resulted in the highest energy bills in Europe.”
The Department for Energy Security and Net Zero was contacted for comment.