My TL;DR:
Ministers have repeatedly claimed developing the huge oilfield off Shetland will improve UK energy security.
For example, in September, Rishi Sunak said Rosebank would help prevent young people from growing up “dependent on foreign dictators” for energy security.
Furthermore, in the king’s speech: “Legislation will be introduced to strengthen the United Kingdom’s energy security and reduce reliance on volatile international energy markets and hostile foreign regimes".
However, in a written answer to a parliamentary question, the government admits that the private companies extracting the oil will sell the vast majority internationally: “Around 80% of the oil produced in the UK is refined overseas into the products demanded by the UK market".
Alexander Kirk, of the climate justice group Global Witness, says “UK oil and gas is owned by the companies that extract it and sell it on global markets. New oilfields like Rosebank will only line the pockets of rich fossil fuel firms, it won’t help the millions of Brits that are struggling to pay their bills.”
Edit: Making title more clear.
The increased supply will reduce the global price which makes oil products cheaper to UK consumers.
Sorry buddy but the price of energy in the UK is no longer correlated with supply and demand and hasn’t been for at least two years now.
Obviously it is. When oil prices are high, do petrol prices go down?
A better question is, if the underlying cost of providing energy has increased, why are fossil fuel companies reporting record high profits.
Because when you charge 20% on something and the value of that thing doubles you make double the amount too. I think the UK government is way too cosy with big oil and is scared of asking for more
Think about what you just said for a second.
If the price doubles and the profit margin remains the same, that exactly means that the price is inelastic.
Which is directly synonymous with saying the price is not subject to supply and demand pressure because that would imply elasticity.
You pointed to price inelasticity as proof of price elasticity. God fucking damn.
By oil products do you mean fuel?
The article linked highlights that the government (despite their earlier claims) is now admitting that majority of this oil will end up being used to manufacture products rather than as fuel used to heat homes, power our cars, etc. So the price of fuel derived from oil will assumedly not be significantly affected (or not as much as was being claimed previously).
Maybe the price of essential/luxury manufactured products will go down but this doesn’t change the fact the government misled people as to what this oil would be used for.
Edit for clarity.
It makes the already-wealthy owners of the extraction license wealthier and nothing more than that you [edit personal insult removed because I didn’t realize this wasn’t Hexbear, disculpe]
Theoretically, that would only reduce the price proportional to the amount of new production relative to existing world production. This does little to dampen market turbulence.
True. Oil companies hold up the FTSE 100 so the government are pussies about demanding taxes
Right so why have they been granted extra licenses since they clearly are enough of a market force already. Why give them more of a share when they don’t apparently contribute anything to the economy.