Investments in the North Sea oil and gas sector have shown few effects so far from the slump in oil prices, and the drive to reduce operating costs in the region has not affected projects’ appetite for steel.
Fixed lengths for rig contracts, and the high discontinuation costs associated with offshore projects, tend to minimise the short-term effect of low oil prices on the North Sea industry.
Existing infrastructure is also giving it a competitive advantage, compared with other exploration and production areas worldwide.
In the long run, however, the prospects for growth will depend on the recovery in oil prices, which analysts forecast will be seen from 2016 onward.
Oil price crash
Since summer 2014, the price of Brent crude, the international crude oil benchmark, has fallen by more than 40%, reaching $53.73 per barrel on January 20, 2015, before beginning an unstable recovery. It closed at $56.85 on Tuesday July 7 this year.