More State Aid for Scotland

The economic case for Scottish independence was always based upon an optimistic view of the value of North Sea oil.  Whilst experts believe that there are still between 15 and 16 billion barrels to be extracted over the next 20 to 30 years, the cost of retrieving the crude is becoming uneconomic.  At the height of the independence campaign, Brent Crude was valued at over $100 per barrel - today it is about $70.  Most Scottish fields would struggle to be profitable at $80 so mothballing of capacity is inevitable.  Already, job losses in the industry are mounting.  Worse, scarce exploration resources could be withdrawn from the North Sea to more potentially profitable areas, completing a deadly spiral, all of which leaves the SNP arguments of sunlit uplands in tatters.

The Autumn statement recognised the oil industry's difficulties and promised some £450 million in rebates and tax aid to prop up the ailing enterprise.  But that aid comes at the expense of expenditure somewhere else.  Some may argue that Scotland is already doing very well out the English tax-payer and that a further injection of support should, perhaps, be directed to the embryo English shale industry which is an altogether better economic prospect.   It is particularly galling to contemplate the situation of having propped up an ailing Scottish oil industry only to have it used as a weapon against England when, inevitably, the independence debate reopens!