Labour’s Right Turn: Why North Sea Oil Is the Next Big Win

A North Sea oil rig operating worryingly close to shore

We have more stock tips for you today with multibag potential.

But first, let’s get political.

Remember how the Conservative Party from David Cameron onwards effectively abandoned the right and became social democrats?

Increased state spending everywhere, so that instead of shrinking the state they grew it, more taxes, higher taxes, more planning and regulation, more quangos and experts, ‘owning’ the NHS, green subsidies, Net Zero, social liberalism, MPs who didn’t represent the views of the membership, increased immigration, weaker policing, increased crime - and so on. Those were the days, eh?

The Tories were so bereft of first principle, and so terrified of the left, particularly the left-wing media, that they pandered to it and eventually became it.

I remember going on podcasts 18 months ago making the argument that Labour would do the same thing and lurch right.

After an insert-disparaging-adjective-here first six months, which saw Prime Minister Keir Starmer’s approval ratings drop below even those of Rishi Sunak, we are starting to see that happen.

With the books not balancing, suddenly spending is being cut. Not by a lot, but it’s happening. Starmer has axed NHS England, something the Tories would never have dared do, criticising “two layers of bureaucracy”. We have what the Independent calls “Austerity 2.0” with cuts to disability benefits and welfare spending. The foreign aid budget has been cut to spend more on defence. All of a sudden he is as champion of small businesses. Heck, he’s even fixing the potholes. Meanwhile, he is boasting on X about “securing our borders” and “removing illegal immigrants at the highest rate in 8 years”.

“If you don’t have the right to be in this country, then you shouldn’t be here. It’s that simple,” he said yesterday. Does that sound like a Labour leader or Nigel Farage?

When fantasy meets reality

The next right-wing shoe to drop is fossil fuels.

Ed Miliband’s fantasies of climate justice and clean energy are slowly being exposed. His green delusion is going to be abandoned. If an economy is to grow, then it must consume more energy, not less. Wind and solar power are too expensive and too unreliable, never mind the damage they do to the environment and the carbon footprint they leave. They are already pledging to paint offshore wind farms black because of all the birds they are killing. Finally, an admission of the wildlife these things destroy.

Offshore wind is not going to replace oil and gas. Fossil fuels remain a better, cheaper, cleaner and more reliable source of energy. For an already heavily taxed country that is living well beyond its means, where growth is the only thing that can save it, with the added pressure of Trump tariffs soon coming, needlessly expensive energy is not possible.

The Reform party is making the cost of Net Zero one of its main lines of attack. All Labour has to do is further abandon the left of its party, a process which is already half complete, just as the Tories abandoned the right, and let Miliband go, which is inevitable anyway, and the Reform weapon is blunted.

All the above is preamble to my main argument today. North Sea oil and gas is going to stage a comeback. This is going to happen, as sure as eggs are eggs. Political and economic reality mean it is inevitable. Otherwise, the national finances, and with them the Labour Government, evaporate. Power is more important to politicians than adhering to any zealotry, green or otherwise.

The ban on new North Sea oil and gas licenses will be lifted. The taxes on North Sea oil companies will be lowered to incentivise activity (it’s effectively 78% at present. Are legislators demented?). And all those companies that saw their businesses and market caps decimated by this deluded religion are going to make a comeback. Some will multiply many times over. That’s what I think is going to happen, anyway.

This also means, for we observers on the foothills of inconsequence, the time is nigh to buy North Sea oil and gas companies.

So what are these companies and how do we invest?