Boris Johnson goes all out to solve the UK's energy squeeze

The UK government has done an about-turn and is now interested in pressing ahead with new North Sea projects. PA

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Famously, when Prime Minister Harold Macmillan was asked what the greatest challenge for a statesman was, he replied: “Events, dear boy, events.”

That's certainly true where Russia’s onslaught against Ukraine is concerned. Suddenly, long accepted governmental stances in the UK are being hastily revised.

Oligarchs are no longer welcome, sanctions are bashed through, money laundering laws are drafted, households will be incentivised to take in refugees, Chelsea Football Club must be sold. On it goes, a bewildering array of about-turns and reversals.

None more so than in oil and gas. This week, the prime minister tweeted a picture of himself sitting with UK industry leaders in Downing Street. They're looking pensive and earnest, Mr Johnson is wearing his thoughtful, concentrated face (there is a camera present after all, and these are crisis-torn times). Nevertheless, give him his due, it's clear this was a workmanlike meeting.

A few days later the prime minister was touching down in the Emirates and Saudi Arabia where the focus on working with overseas partners to stimulate investment both in the UK and elsewhere was very much on the agenda.

Mr Johnson would have liked to push for increased oil imports as well but oil production is a matter for OPEC. He did, though, raise closer energy partnerships and stressed the need for greater oil and gas security and less dependence on Russia.

The messages overseas were in keeping with the talks in the pillared room at Downing Street where Mr Johnson had gathered some of the most eminent names of Britain's energy past and fast-evolving future. He had invited the executives in to share their views on how Britain’s oil and gas needs can be made more secure. Wind turbines, solar panels and nuclear were not the sole items on the agenda.

There was also talk of powering ahead with new North Sea projects. Remember the North Sea? And you thought the UK had written it off as well and truly “over”.

North Sea a 'vital' cog in nation's engine

After all, this was the prime minister who has spent months if not years talking about fossil fuels in terms of the past. Mr Johnson’s wife, Carrie, upstairs in the Downing Street flat, and her green pals would regard these executives with obvious disdain.

It is true the issues surrounding the cost and availability of petrol at the pumps are now felt by every household. Mr Johnson cannot bear a screaming tabloid headline about pain at the pumps. At the discussion, Mr Johnson, we're told in the official readout, “reaffirmed his steadfast commitment to the North Sea oil and gas industry as a key asset in the UK’s plans for achieving greater energy independence, in ensuring the country’s smooth transition to net zero and in being part of the solutions needed for a cleaner future – which are ever more crucial as we move away from Russian hydrocarbons following Putin’s illegal invasion of Ukraine. This was welcomed and echoed by industry leaders …”

To be fair to Mr Johnson, other roundtables are planned with renewables and nuclear bosses, and the government is moving quickly to publish its plans for increased energy security, possibly before the end of this month.

The oil and gas captains and Mr Johnson “also spoke about how the oil and gas industry plays a vital role in providing the solutions for our net zero future, including in the production of low-carbon hydrogen and roll-out of new carbon capture projects, which the sector is well positioned to take forward thanks to its skills and expertise”.

Their focus, however, was determinedly on the North Sea. The "prime minister and CEOs discussed increasing investment in the North Sea oil and gas industry, and boosting supply of domestic gas. This included how the UK can remove barriers facing investors and developers, and help projects come online more quickly. They agreed to work together going forwards to help accelerate this further”.

Green wave

All good, except as is often the way with these things, the reality is somewhat different. MPs have been told that offering new oil and gas licences on the UK side of the North Sea “is not a reasonable response” to the impact on prices caused by the war in Ukraine.

The UK's Oil and Gas Authority has worked with consultancy Wood Mackenzie to show that the lead time between confirmation of a new resource discovery and reaching a key final investment decision is five years.

Mr Johnson’s typical full-pelt strategy may then succeed – but in five years at the very earliest, assuming the oil and gas is there to be extracted in sufficient quantities and cost efficiently.

Tightening energy security ignores the other issue, which is surging global prices. All experts are agreed that high fuel bills are here to stay, at least for the foreseeable future. As well as banging the table and encouraging oil and gas companies to return to the North Sea, Mr Johnson must tell the UK consumer to cut down.

Prof Mike Bradshaw, of Warwick University, said it is all every well talking about new drilling licences but “how secure is a gas supply that you can't afford, even if half of it is domestically produced? I think we need to bear that in mind and think about the impact that has on everyone”.

Similarly, another expert, Dr Jack Sharples, a research fellow at the Oxford Institute for Energy Studies, emphasised that price vulnerability is not something the UK can address in the near term.

“The UK cannot decouple, in a pricing sense, from the rest of Europe,” he said. “We cannot control the wholesale prices so, instead, we need to focus our efforts on how we adapt and cope with those prices, rather than try to control them.”

Brits must change their behaviours. Rather than take electricity and gas for granted, we should learn how to manage them sparingly. It is possible: after the Russian attack, attention is being paid to the Japanese response to their Fukushima nuclear disaster and how people learnt to restrict demand.

One moment Mr Johnson is all for programmes to boost our renewable production; the next, he's having to try to make North Sea oil and gas enticing again.

Also, he is probably going to have to plead with us to turn our thermostats down, to wear an extra layer to keep warm. No one said being prime minister is easy. Macmillan had it right.