Israel helped launch the war that closed the Strait of Hormuz. Britain is paying the price. The collapse of North Sea energy production\u2014decades in the making, accelerated by political negligence\u2014has left the United Kingdom naked to a supply shock of historic proportions. For Israel, a nation that has staked its energy future on offshore gas platforms within missile range of its enemies, Britain\u2019s unravelling is not a foreign news story. It is a warning in relation to national energy security.\n<\/p>\n
The chart now circulating on Sky News tells the story with brutal clarity. North Sea gas production, measured in million tonnes of oil equivalent, peaked near forty and is in precipitous decline. Even the Offshore Energies UK upside scenario\u2014the most optimistic projection available\u2014merely softens the gradient and is highly contentious. It does not reverse it. By the early 2040s, both curves converge toward zero. The UK Continental Shelf, once the foundation of British energy sovereignty, is being emptied by geology and accelerated by policy.\n<\/p>\n
The numbers are stark. Production has fallen seventy-five per cent since its 1999 peak. Over 180 of the 280 active oil and gas fields are expected to cease production by 2030. Not a single exploration well was drilled in the fiscal year 2024\u201325\u2014the first time in North Sea history. The net rate of return for offshore operators averaged minus one per cent in the twelve months to June 2024. The Energy Profits Levy, introduced when oil was trading at $122 per barrel, remains in force at a headline rate of seventy-eight per cent\u2014despite prices having returned to normal levels. Capital has fled. Major international operators are divesting, and once decommissioned infrastructure hubs are switched off, they cannot be turned back on.\n<\/p>\n
This would be a serious strategic deficit in any environment. In the environment of March 2026, it is catastrophic.\n<\/p>\n
On 28 February, the United States and Israel launched Operation Epic Fury, a coordinated air and maritime campaign against Iran that killed Supreme Leader Ali Khamenei and struck nuclear facilities, military infrastructure, and naval assets. Within days, Iran\u2019s Revolutionary Guard Corps achieved what decades of threats had never delivered: the effective closure of the Strait of Hormuz. The method was not a conventional naval blockade but selective drone strikes sufficient to cause insurers to withdraw coverage. The strait shut down not because of mines or missiles, but because of insurance withdrawal\u2014an actuarial closure, not a military one.\n<\/p>\n
The consequences have been immediate. Brent crude has surged above $100 per barrel for the first time since 2022, peaking at $126. UK wholesale gas prices have risen seventy-two per cent in thirty days. QatarEnergy declared force majeure after shutting down production at its Ras Laffan facilities. Drone attacks have struck Gulf energy infrastructure. Even the bypass routes\u2014Oman\u2019s deep-water ports at Duqm, Salalah, and Sohar\u2014have been targeted. The International Energy Agency has described this as the largest supply disruption in the history of the global oil market.\n<\/p>\n
For Britain, the timing is lacerating. The UK is now import-dependent for over fifty-five per cent of its gas supply, a figure projected to reach sixty-eight per cent by 2030 and ninety-four per cent by 2050\u2014even if new fields like Rosebank are developed. In 2024, the UKCS provided forty-three per cent of UK gas, Norwegian pipeline imports another forty-three per cent, and LNG made up fourteen per cent. That LNG share, though small, is priced on global spot markets and acts as the marginal molecule that sets the wholesale price for the entire system. When Hormuz closes, the price of that marginal molecule detonates upward through the entire supply chain.\n<\/p>\n
The distribution of risks Britain faces is not normal in any sense of the word. A simultaneous domestic production collapse, a chokepoint closure, and the force majeure shutdown of a primary LNG supplier is not a coincidence of bad luck. It is the compounding of correlated vulnerabilities\u2014the fat tail that decades of complacent energy policy failed to stress-test against.\n<\/p>\n
Ofgem\u2019s price cap, set for April to June before the crisis erupted, provides temporary insulation, but wholesale increases will filter through from July. LCP Delta projects wholesale electricity costs to rise forty per cent this year and eighteen per cent next year, with gas prices seventy per cent above pre-conflict forecasts. Goldman Sachs has warned that if Hormuz disruption extends through the second quarter, global inflation could rise by 0.7 to 0.8 percentage points while GDP growth faces a drag of up to 0.4 points. For households already reeling from the 2022 Ukraine shock, this is another winter of impossible choices between heating and eating.\n<\/p>\n
Downing Street, meanwhile, is governing energy policy the way a hospital administrator manages a cardiac arrest\u2014by convening a committee. Starmer\u2019s government will neither accelerate the renewable transition with the urgency the crisis demands nor preserve North Sea production with the fiscal reforms the industry requires. The moratorium on new licensing continues. The Energy Profits Levy remains punitive. The clean energy jobs promised for Scotland materialise at a pace that cannot absorb the 70,000 positions lost in the North Sea sector since 2016. The North Sea Transition Board, launched in January 2026, is institutional choreography when what is needed is strategic triage.\n<\/p>\n
[https:\/\/www.gov.uk\/government\/news\/new-north-sea-board-launched-to-drive-a-fair-and-prosperous-transition]\n<\/p>\n
Norway, Britain\u2019s most critical pipeline supplier, offers no salvation. Westwood Global Energy Group\u2019s latest assessment is blunt: two of three official Norwegian production scenarios show steep decline after 2026. Meanwhile, UK gas storage stands at a mere 3.1 billion cubic metres\u2014ten to sixteen days of demand\u2014leaving the country acutely exposed to winter peaks and the global market volatility that is now structural rather than episodic.\n<\/p>\n
Le Chatelier\u2019s Principle from thermodynamics is instructive. When a system in equilibrium is subjected to external stress, it adjusts to partially counteract that stress\u2014but only if it has degrees of freedom through which to respond. Britain has systematically eliminated its degrees of freedom. Domestic production is in terminal decline. Storage is negligible. The renewable transition is behind schedule. The LNG supply chain runs through a war zone. Norwegian supply is plateauing. Every shock-absorber has been removed, and the shocks are arriving.\n<\/p>\n
Transaction cost economics, following Williamson, teaches that asset specificity creates bilateral dependency and vulnerability to opportunistic behaviour. Britain\u2019s energy infrastructure is supremely asset-specific: pipelines, terminals, and generation capacity configured around particular supply routes and fuel types. As domestic production withers, the dependency shifts toward suppliers who operate through the world\u2019s most volatile chokepoints. The insurance-driven closure of Hormuz is a textbook case of transaction costs rendering an entire supply chain inoperable overnight.\n<\/p>\n
What, then, remains? Very little in the near term. The 8.4 gigawatts of offshore wind secured in Europe\u2019s largest-ever auction this year is a genuine achievement, but wind farms take years to build and do not heat twenty-three million homes connected to gas boilers. Carbon Brief\u2019s analysis shows that new renewables will avoid more LNG imports than new North Sea drilling by 2030\u2014but 2030 is four years away and Hormuz is closed today.\n<\/p>\n
Britain\u2019s energy position has become structurally indefensible. The North Sea decline curve is not a forecast to be debated but a geological fact to be confronted. The Hormuz crisis is not a temporary disruption to be weathered but a structural revelation of what import dependency means when chokepoints are contested by states with nothing left to lose. The convergence of domestic depletion and global supply shock is the fat-tailed event that decades of complacency failed to price in.\n<\/p>\n
What is required is not another review but a war footing: an emergency suspension of the Energy Profits Levy to halt the capital exodus, a crash programme to expand gas storage beyond its current pitiful fortnight of cover, and a doubling of the renewable deployment timeline\u2014not by 2030, but by 2028. The diagnosis is geological and geopolitical. The prescription is political will.\n<\/p>\n
The tank is empty. The bill is arriving.\n<\/p>\n
Britain\u2019s Energy Vulnerability Scorecard \u2014 Pre-Crisis vs. March 2026\n<\/p>\n
Indicator
\nPre-Crisis
\nMarch 2026
\nDirection<\/p>\n
Brent crude ($\/bbl)
\n$71.32 (27 Feb)
\n$103 (17 Mar)
\n+44%; peaked near $120<\/p>\n
UK wholesale gas (p\/therm)
\n~72p
\n~124p (17 Mar)
\n+72% in 30 days<\/p>\n
European gas (EUR\/MWh)
\n\u20ac30 (late Feb)
\n\u20ac48\u201360 (early Mar)
\nNearly doubled<\/p>\n
Hormuz tanker traffic
\n~20m bbl\/day
\nDown >90%
\nNear-total halt<\/p>\n
UK gas import dependency
\n55% (2024)
\n55%+; rising
\n68% by 2030; 94% by 2050<\/p>\n
UKCS production vs. 1999 peak
\n~20% of peak
\n~20% of peak
\n75% decline; accelerating<\/p>\n
Active oil and gas fields
\n~280
\n~280
\n~180 to cease by 2030<\/p>\n
Exploration wells (2024\u201325)
\nTypically dozens\/yr
\nZero
\nFirst blank year in history<\/p>\n
UK gas storage capacity
\n3.1 bcm
\n3.1 bcm
\n10\u201316 days of demand<\/p>\n
QatarEnergy LNG status
\nOperating
\nForce majeure
\nRas Laffan shut down<\/p>\n
EPL headline tax rate
\n78%
\n78%
\nUnchanged despite price normalisation<\/p>\n
Operator net rate of return
\n\u22121% (to Jun 2024)
\nNot yet reported
\nInvestment climate hostile<\/p>\n
Norwegian supply outlook
\nStable to 2026
\nPlateau
\n2 of 3 scenarios: steep post-2026 decline<\/p>\n
IEA supply disruption assessment
\nSurplus forecast
\n8m bbl\/day loss
\nLargest in history<\/p>\n
Sources: OEUK; NSTA; IEA Oil Market Report (March 2026); Westwood Global Energy Group; S&P Global; Smart Energy Company; Ofgem; ONS. Compiled by the author.\n<\/p>\n
Israel, the co-architect of Operation Epic Fury, should study Britain\u2019s predicament as a cautionary parable rather than a foreign curiosity. The Leviathan and Tamar gas fields have transformed Israel from a net energy importer into a regional exporter, with natural gas now generating roughly seventy per cent of the country\u2019s electricity and underpinning a $35 billion, fifteen-year supply contract with Egypt. Chevron\u2019s $2.36 billion expansion decision in January 2026 signals long-term confidence. Yet the war Israel helped initiate has already exposed the fragility of this achievement. Both Leviathan and Karish were taken offline as a precautionary measure after Israeli strikes on Iranian oil infrastructure in March, leaving the country temporarily reliant on the single Tamar platform to meet domestic demand. Iran\u2019s ballistic missile strike on the Haifa refinery and the Bazan energy complex demonstrated that offshore platforms and coastal processing facilities are targets, not sanctuaries. If Britain\u2019s lesson is that domestic energy abundance can be squandered through fiscal complacency and policy paralysis, Israel\u2019s lesson should be that energy abundance newly won can be lost through strategic overreach. A nation that derives seventy per cent of its electricity from gas platforms within missile range of hostile actors, and that exports through pipelines traversing contested territory, cannot afford to treat energy security as a problem solved. Israel must accelerate its solar and storage deployment, harden its offshore infrastructure against the threats this war has made explicit, and resist the temptation to tax its gas sector into the same capital flight that has hollowed out the North Sea. The geology is generous. The question\u2014as Britain has learned at ruinous cost\u2014is whether the politics will be.\n\t\t<\/p>\n","protected":false},"excerpt":{"rendered":"Israel helped launch the war that closed the Strait of Hormuz. Britain is paying the price. The collapse…\n","protected":false},"author":2,"featured_media":549952,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[64,63,99,164],"class_list":["post-549951","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-au","tag-australia","tag-business","tag-economy"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/549951","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=549951"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/549951\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/549952"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=549951"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=549951"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=549951"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}