As the importance of coal has declined, oil has become of increasing significance. Crude oil can be refined to produce a wide variety of products including petrol and diesel oils for motor vehicles, aviation spirit, domestic heating oils, and even feedstuffs for animals. Up to the early 1960s, over 99 per cent of Britain’s petroleum requirements were imported, primarily from the Middle Eastern countries. Since then considerable discoveries of crude oil and natural gas have been made in the North Sea, and the first oil was brought ashore in 1975. Oil production has grown steadily since that time, amounting in 1987 to 123 million tonnes. The discovery of substantial offshore oil and gas reserves has changed Britain’s energy position, it has become self-sufficient in energy.

The most important offshore oilfields are to be found off the coasts of north-east England and especially eastern and northern Scotland. In 1989 over 40 fields produced oil, the largest of them being Brent, Forties, Ekofisk and others. The principal oil producing area lies between the latitudes of the Tyne and Shetland Islands, but known to extend to the latitudes of Iceland. The Forties field, 177 km from Aberdeen, was discovered in 1970 and started production in 1974. The Brent field lies off the Shetlands where the production is more difficult because of the severe weather. The discovery of oil in the North Sea had a great impact on the pattern of crude oil transport.

About 1,686 kilometres of submarine pipeline have been built to bring ashore oil from a number of North Sea oilfields. There are a considerable number of further exploratory drillings taking place throughout most of the North Sea.

With the growth in offshore oil production Britain has become an important oil exporter, mostly to the USA and West Germany. The share of imports has fallen considerably, though Britain continues to import heavy crude oil of lower quality from Saudi Arabia, Kuwait and Norway, primarily for the production of diesel oil widely used by motor transport.

In charge of the British oil industry are the two leading companies — British Petroleum (BP) and Shell, which gain tremendous profits from the industry. They are the two largest industrial companies in Britain in terms of turnover.

Onshore production of crude oil in Britain accounts for only a small fraction of the country’s requirements. At the beginning of the 1980s it amounted to about 230,000 tonnes, the greater portion of which was produced from Britain’s largest onshore field at Wytch Farm (Dorset), which started production in 1979. Several other onshore fields are in operation, chiefly in Nottinghamshire, Lincolnshire and in South England. Between 1850 and 1962 crude oil was extracted by a distillation process from oil-shales, i. e. rocks impregnated with a tarry substance, which are found on the southern side of the Firth of Forth (Central Scotland). These deposits are, however, almost completely worked out, and production ceased.

For many years gas was produced from coal and had important applications as fuel for domestic gas stoves and systems of central heating, in steel-making and in other industrial processes. But during the 1960s, when growing supplies of oil were being imported, there was a switch to producing town gas from oil-based feedstocks.

However, a more significant change began in the late 1960s following the first commercial natural gas discovery in the North Sea in 1965 and the start of offshore gas production in 1967. Supplies of the offshore natural gas grew rapidly and natural gas now replaced town gas as the source of gas for the public supply system in Britain.

In 1987 home-produced natural gas accounted for 78.5 per cent of total natural gas supplies, the remainder coming from Norway and Algeria. Output of natural gas from the continental shelf amounted to 47,641 million cubic metres. Production comes mainly from six major gasfields, Leman Bank, Hewett, Viking and others. A growing amount of gas produced in association with oil in oilfields is being brought ashore, particularly from the Piper field.

Most gas has been found at a depth of 300 m but new finds off the Norfolk coast have been tapped at under 1,520 m. The national pipeline system of some 5,000 km provided for the distribution of natural gas. It is supplied by feeder mains from North Sea shore terminals and from the Canvey Island terminal. Indigenous offshore natural gas supplies are expected to be sufficient to meet the major part of British requirements into the twenty-first century. The British Gas Corporation is also developing the Morecambe gas field in the Irish Sea.