The UK's critical role in Europe's integrated oil system

Europe’s energy security rests on a foundation that few fully understand: a network of crude oil production, refining, and trade that crosses borders seamlessly. At the centre of this network sits the United Kingdom—not as a peripheral player, but as a critical pillar supporting continental energy flows.

The UK-Europe oil connection is deeply symbiotic, built on decades of infrastructure investment, trading relationships, and refining optimisation.

Wood Mackenzie was commissioned by Ithaca Energy to conduct an independent analysis of the trade of UK crude oil production. The report has been endorsed by OEUK.

The objective of the study is to understand the UK’s role in the European oil market focusing on UK crude oil production and the end markets for crude oil and refined oil products. The analysis uses a range of proprietary Wood Mackenzie market analysis and data from tools including but not limited to: Upstream Service, Energy Transition Service, Global Oil Supply Tool, Refinery Evaluation Model.

Here are the key findings:

• Europe faces a stark energy reality: 80% of its crude oil supply comes from imports. With regional consumption reaching 12.6 million barrels per day (b/d) against domestic production of just 2.5 million b/d, the continent's energy security depends on a highly integrated supply network—and the United Kingdom sits at the heart of it.
• As Europe's second-largest oil producer after Norway, the UK plays an outsized role in regional energy flows. The country exports more than 80% of its crude oil production, with 86% destined for European refineries. This translates to a critical supply pipeline: 370,000 b/d flows from the UK to Northwest Europe alone, representing nearly three-quarters of total UK crude exports.

• But the story doesn't end with crude exports. The relationship is deeply symbiotic. Northwest European refineries process UK crude and return 288,000 b/d of refined oil products back to British shores. In total, 89% of UK crude production is refined somewhere in Europe, and remarkably, 65% of volumes produced in the UK ultimately serve the UK market—either directly through domestic refineries or indirectly via the Northwest European refining and trading network.

The report reveals a fundamental truth: the UK and Europe operate as a single, integrated energy system. UK crude production doesn’t just support British energy needs—it stabilises European refining runs, diversifies supply sources, and reduces collective dependence on imports from outside the region.

Conversely, European refining capacity provides the UK with access to a broader range of refined products, greater supply flexibility, and enhanced energy security than domestic infrastructure alone could provide.

As Europe navigates the energy transition and policymakers on both sides of the Channel debate the future of oil and gas production, this integration cannot be ignored. Decisions about UK production have European consequences. Policies affecting European refining have UK implications. The UK and Europe operate as an integrated energy system, not as independent markets. The UK's role is not merely significant - it is critical to the stability and functioning of Europe’s energy markets.

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