Skip to content
Thomson Reuters

The Financial & Risk business of Thomson Reuters is now Refinitiv. Visit
All names and marks owned by Thomson Reuters, including "Thomson", "Reuters" and the Kinesis logo are used under license from Thomson Reuters and its affiliated companies.


What’s in the pipeline for UK’s oil markets after Brexit?

Saida Litosh, Serkan Sahin

08 May 2017

A section of the BP Eastern Trough Area Project in the North Sea, around 100 miles east of Aberdeen in Scotland. Photographer: Andy Buchanan

Examining the impact of Brexit on the UK oil industry is complicated by potential developments in Scotland. Charts from Thomson Reuters Oil Research show what’s in the pipeline.

The European Union (EU) is the major source of gasoline products in the UK, accounting for roughly 85% of the total, and standing at 3.43 million metric tons (mt) in 2015.

Get award-winning Commodity trading insight from Thomson Reuters

According to Thomson Reuters Oil Research, gasoline imports from the EU were broadly flat year-on-year in 2016, at around 3.10 million mt for the period of January to November 2016.

Norway and Russia are amongst other gasoline suppliers to the UK. However, their combined share is markedly smaller, at around 15%.

Find out more about Energy commodities

UK gasoline imports

In the event that the UK leaves the Customs Union together with the European Union, there could be additional costs to the European gasoline imported into the UK, potentially limiting total motor fuel imports from the UK.

On the other hand, the UK market constitutes just 5% of total EU gasoline exports, with most product typically heading to the United States and Africa.

Find out more about Commodities trading at your command

UK gasoil/diesel imports

Standing at just over 7 million mt in 2015 and 7.37 million mt between January – November 2016, the EU is the top supplier of gasoil/diesel into the UK, accounting for about 50% of total imports.

Russia and the United States are among other major suppliers, with an average share of 23% and 19% respectively over the past two years. 

Find out more about Energy commodities for efficient energy trading

During the period of January through November, gasoline/diesel imports from the U.S. increased to 3.17 million mt in 2016, up by more than 1 million mt or 48% y-o-y.

This suggests that the UK could potentially increase imports from the U.S., as well as Russia, if the cost of importing European gasoil/diesel rises.

Find out more about Eikon

UK crude oil production

The UK is the second largest producer of crude oil in Europe after Norway.

According to Thomson Reuters Oil Research, production from the UK will decline by 12% to 0.84 million bod y-o-y in 2017. 

With its share of European crude oil output declining, the call on crude oil demand from domestic production and Russian, Middle Eastern and African suppliers is rising.

Find out more about Commodities trading at your command

On the other hand, Norway, the other large supplier of crude to the country, is not a member of the European Union, so Brexit should not affect its bilateral trade relations with Norway.

Sign up for webinar — OPEC and the Supply Overhang: A Market Outlook

Scotland factor

The real risk to the upstream sector would come from Scotland gaining independence before the UK actually leaves the European Union.

Find out more about Energy commodities

Shakil Begg, Head of Oil Research, said: “Most of the UK’s crude oil output is produced from Scotland’s Exclusive Economic Zone (EEZ).

“The share of Scotland EEZ fields historically has always been more than 80% of total UK output and this is rising as the majority of exploration and development activities continues to take place in Scotland’s EEZ.

“Scotland’s potential independence would result in the loss of major domestic crude oil sources and thereby tax revenues, a potent negative result of Brexit.”


Ag Forum tackles U.S. crop outlook Exploring the energy landscape with Thomson Reuters Corn yield forecasts ahead of the rest Will the gold price pick up again in 2018? Coping with commodity price shocks in your supply chain What do Iraq tensions mean for oil markets? Will China’s carbon market be a climate changer? Commodity derivatives: New indices opening up to Indian investors Storm warning for supply chains after Hurricane Irma devastation #TRCropWatch: giving traders a better view of corn and soy fields