North Sea oil can’t rely on the Saudis losing their nerve

Outlook

Grangemouth oil refinery (Getty)

More bad news from the manufacturing sector, which remains in recession according to official figures. Output was 0.4 per cent lower in November than in October and 1.2 per cent lower than a year earlier. It is still well below its pre-financial crisis peak.

The numbers were released on the same day that BP announced thousands of redundancies globally, a substantial chunk of which will fall upon its North Sea business. The low oil price is making life all but impossible for businesses in places where the cost of production is high. The North Sea falls into that category.

Talk of an emergency Opec meeting appears to be just that. Several commentators have pointed out that tumbling oil prices are squeezing the economy of Saudi Arabia, its biggest producer. But its government doesn’t appear inclined to blink, so this will not be the last set of job cuts to hit the UK’s oil industry. None of which will help our yawning trade gap.

Those who are inclined to fret about it may need to reach for their Valium.