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Oil Imports

Volume 180: debated on Monday 12 November 1990

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To ask the Secretary of State for Energy what was the total volume of oil imports into the United Kingdom for each of the last seven years.

The total volume of oil imports into the United Kingdom for each of the years 1983 to 1989 inclusive, are, in million metric tonnes, 40·1, 53·5, 52·1, 56·4, 53·9, 54·2 and 58·1 respectively. However, for each of those years the volume of oil exports from the United Kingdom exceeded the level of imports.

In so far as the Government have raised £100,000 million in oil revenues in the past 10 years and gained thousands of millions of pounds in terms of benefit to the balance of payments, can they tell us where all that money has gone? Why was not part of it used to ameliorate conditions of exploration and drilling in the North sea?

In answer to the specific question about the North sea, it is clear that the level of activity is as high as it has ever been and that the level of capital investment is steadily going up. There is no lack of investment in the North sea. On the more general point raised, the hon. Gentleman will know that, as a result of many things, not least the revenues from the North sea, we have been able to spend far more on the health service—[HON. MEMBERS: "Oh!"]—and on investment, we now have a higher standard of living and we are spending more on social services than before. Perhaps that is what is upsetting the hon. Gentleman.

Does my right hon. Friend agree that the oil that we get from the North sea is of a high quality and, because of that characteristic, we can trade it at a higher price per barrel than the oil that we bring in? Therefore, is not it true that by trading oil, we can make a profit for this country, not only because we export more than we import, but because we export high-quality oil?

My hon. Friend is right. Crude oil imports account for about half of the United Kingdom's refinery throughput. As my hon. Friend is well aware, a similar proportion of United Kingdom crude oil is exported. The high proportion reflects the price differential—more than £2 a tonne—in favour of the United Kingdom because of the high quality of North sea oil.

Does the Secretary of State think that Scotland has had value for money from the £100,000 million with which it has bankrolled the Government during the past 10 years? The Secretary of State will have noted the effect on the balance of payments of high oil prices and also that Shell and BP, announcing more than £1,000 million of excess profits last week, said that those would contribute to oil taxation. If that is so, why, in his autumn statement, did the Chancellor forecast a £100 million decline in oil revenues for this year? What has happened to the £1,000 million?

First, I do not go to Aberdeen as often as the hon. Gentleman, but I go quite often and it strikes me as a pretty prosperous part of the world. The only thing that baffles me is why anybody should have elected him in that part of the country, but that is a matter for them to decide, not for me. It is a lovely part of the world and pretty prosperous.

The stock adjustments included in the recently announced BP and Shell profits give rise to only paper increases in profits. We should also remember that the greater part of oil companies' stocks are held under Government direction—the companies do not have the discretion to dispose of such stocks and realise the profits in the paper increase.