Study: Oil & gas boost European government treasuries by over €400B annually

Posted on 18 June 2014

Oil and gas contribute hundreds of billions of euros to European government revenues every year, a new study shows, highlighting how the industry – far from being subsidized – crucially boosts public finances in the European Union and Norway.

Energy taxation and subsidies in Europe, a study commissioned by the International Association of Oil & Gas Producers (OGP) and carried out by independent consultant NERA Economic Consulting, sheds light on the financial contributions and subsidies in the European energy sector. “Far from being subsidized, the oil and gas industry is among the largest contributors to government revenues in the energy sector,” Roland Festor, OGP’s EU Affairs Director, explained.

OGP commissioned the research to show facts about European government subsidies to energy industries. The issue is often intensely debated, with conflicting numbers and complicated methodologies.

“Reliable figures are crucial now as the European Union looks at state aid, energy costs and consumer protection policies in a bid to protect household bills, preserve industrial competitiveness and ultimately define Europe’s long-term climate and energy policy,” Mr Festor said.

The consumption of one barrel of oil generates $124 (around €90) in government revenue. This contrasts with the consumption of an equivalent amount of energy generated by renewables, which in some cases can cost tax payers more than $700 (or more than €500), the study shows.

Oil and gas contributed €433 billion to the EU and Norwegian government treasuries in the reference year 2011, the latest year for which comprehensive data was available, and received €0.6 billion, making it a net contribution of €432 billion. These numbers are in contrast to the prevailing assertion that oil and gas received billions of euros in subsidies across the EU in 2011.

The full study “Energy Taxation and Subsidies in Europe: A Report on Government Revenues, Subsidies and Support Measures for Fossil Fuels and Renewables in the EU and Norway,” can be found here.

Leave a Reply

*

FEATURED MICROSITES


Recent Drilling News

  • 31 March 2015

    ExxonMobil begins production at Hadrian South in Gulf of Mexico

    ExxonMobil has begun production in the deepwater Gulf of Mexico (GOM) at Hadrian South, with facilities tied back to the nearby Lucius project. Daily gross production...

  • 31 March 2015

    Active risk assessment, global sharing at core of Nabors safety intervention program

    Gagan Singhal, Area Manager at Nabors Drilling International, outlined a new safety intervention system that helps the company...

  • 30 March 2015

    National Petroleum Council: US can safely tap Arctic resources to secure energy needs

    Prudently developing US Arctic oil and natural gas resources would enhance America’s position as a global leader in energy production for the next 35 years...

  • 30 March 2015

    Joint safety improvement plan aligns HSE objectives, “language” for Shell, Halliburton

    Speaking at a joint presentation with Halliburton at the 2015 IADC HSE&T Asia Pacific Conference in Kuala Lumpur on 12 March, Alain Moonen...

  • 27 March 2015

    Gravity-deployed carbon composite cable completes first commercial deployment offshore Norway

    Ziebel, a Stavanger-based provider of specialist well intervention services for the oil and gas industry, announced that its Z-Line gravity-deployed...

  • Read more news