MOSCOW (Sputnik) — British national trade association for the offshore oil and gas industry Oil and Gas UK (OGUK) said Tuesday it expected investment in the North Sea upstream industry to drop by nearly 90 percent in 2016 amid declining oil prices and growing losses.
"Most concerning is the collapse of investment in new projects. This year the upstream industry is expected to approve less than £1 billion to spend on new projects, compared to a typical £8 billion per year in the last five years – sparking fears for the long term future of the industry," OGUK said in a report.
The trade group notes that the government should urgently reform the system of the special taxes paid by the industry to attract investment.
Global oil prices plunged from $115 to less than $30 per barrel between June 2014 and January 2016, hitting their lowest levels since 2003, mostly because of prolonged global oversupply and weak demand.
