The chief executive of the associations representing Britain’s oil and gas industry has hit back at the head of the International Energy Agency (IEA)  after he told the media that the UK should not look to increase its operations in the North Sea.

David Whitehouse, (above) the chief executive of OEUK, has responded to a piece in The Guardian where Fatih Birol, executive director of the International Energy Agency (IEA), stated that “the damage is done,” noting that the global oil crisis has permanently transformed the fossil fuel industry. Birol also recommended that the UK should largely avoid expanding oil and gas production in the North Sea.

Whitehouse said: “The IEA issued its Q2 gas market report which argued that the global economy should strengthen security of the gas supply in the wake of events in the Middle East.

“However, comments from the IEA’s executive director, reported in the Guardian on the same day, would do the opposite. Talking down production in the North Sea and discouraging investment in the UK Continental Shelf contradicts the IEA’s own analysis calling for continued investment in gas and the importance of supply flexibility.”

The IEA’s gas market report said the ongoing supply shock and infrastructure damage are increasing price volatility and pushing back easing of global gas balances.

“The disruption to shipping through the Strait of Hormuz since the start of March has created unprecedented uncertainty, removing close to 20% of global LNG supply from the market and triggering sharp price increases across key importing regions,” it added. “During a period of intense volatility in March, natural gas prices in Asia and Europe rose to their highest levels since January 2023, contributing to a contraction in natural gas demand in key LNG importing markets.

“The crisis has reversed a trend of market rebalancing observed during the 2025/26 heating season, when strong growth in LNG supply – supported by new liquefaction capacity, particularly in North America – helped ease prices. Global LNG trade increased by 12% year-on-year in the October-to-February period, while benchmark prices in Europe and Asia declined by around 25% over the same five-month period.”

The IEA added: “Market conditions shifted abruptly in March as the Middle East conflict resulted in the de facto closure of the Strait of Hormuz to LNG cargoes. Global LNG production declined by 8% year-on-year, with a sharp drop in exports from Qatar and the United Arab Emirates only partially offset by higher output from other regions. As the disruptions began to spread through global supply chains, LNG deliveries also fell, with a more pronounced decline observed in April.

Beyond the immediate disruption, the crisis is expected to have implications for the medium-term outlook, the IEA added. Damage to LNG liquefaction infrastructure in Qatar is set to reduce projected supply growth and delay the impact of the anticipated global LNG expansion wave by at least two years. The combined effect of short-term supply losses and slower capacity growth could result in a cumulative loss of around 120 billion cubic metres of LNG supply between 2026 and 2030. While new liquefaction projects in other regions are expected to offset these losses over time, the impact will prolong tight markets through 2026 and 2027.

Whitehouse said the UK could not afford to ignore the reserves yet to be accessed in the North Sea.

“Growing reliance on carbon-intensive liquified natural gas imports leaves the UK increasingly exposed to geopolitical risk and raises global emissions from production,” he explained. “It also threatens the jobs and skills critical for the energy transition by accelerating the decline of our offshore energy sector.

“There is significant potential left in the North Sea. As the second largest producer in Europe, the UK along with Norway is an anchor of European energy security. With the right tax and regulatory policies, the UK can still produce over seven billion barrels of oil and gas between now and 2050 – significantly higher than the less than four billion we are currently headed for. Around 75% of UK energy demand is met by oil and gas and all decarbonisation scenarios show they will continue to be essential through to 2050.

“We have presented clear analysis to the government that early introduction of the Oil and Gas Price Mechanism (OGPM), a permanent windfall tax to replace the Energy Profits Levy, would unlock £50 billion of new investment. This would allow the UK to meet over half of domestic demand, enhance energy security, increase tax revenues, protect jobs, and reduce reliance on carbon-intensive imports, as part of a balanced energy transition.”