The quiet global energy revolution

In all the noise of tomorrow’s Budget, many may not spot a small tweak to the fiscal regime for UK oil and gas. Those of us with a close interest in unconventional oil and gas, however, will be watching closely. Last year the Chancellor announced a consultation on a specific tax regime for onshore shale gas development, the results of which are expected on Wednesday.

Press coverage of shale gas is often characterised by myth and hyperbole. For some, it’s the last gasp for fossil fuels; for others, a new source of energy security and the key to bringing down bills for industry and consumers.

We are not used to thinking of energy as a diplomatic weapon here, but contrast this with the EU which imports a fifth of its gas from Russia via Ukrainian pipelines. Several times in recent years, Russian gas giant Gazprom cut or threatened to cut Ukrainian supplies.