Beat The BearBeat The BearOil based fuels[1] serve three main and highly important purposes in the UK along with numerous other uses such as lubrication and feedstock to chemical and plastics industries[2].
Aviation fuel[7] is a form of kerosene. Oil, particularly when consumed for transport (essentially burning it) produces atmospheric pollutants[8] and is a substantial source of carbon dioxide in the atmosphere[9], some of which figure strongly in global warming calculations.
Oil shortages[10] have a profound effect on the world economy. The importance of road transport in the UK was analysed in an often-quoted report by Professor Alan McKinnon of Heriot-Watt University, "Life Without Lorries"[11] which warns:
"For the economy as a whole the loss of road transport for a week would be devastating."
Oil is extracted from underground deposits laid down geological ages ago. The oil extracted is known as crude oil and is a highly variable substance containing a mix of complex hydrocarbon chemicals and a number of undesirable pollutants[12]. Crude oil is processed in chemical plants known as refineries to produce the range of oil products needed by consumers. There is no one type of crude oil, it varies from heavy to light in consistency and an important criterion is its sulphur content (sweet crude has little, sour crude has more). As noted in the Deloitte Analysis[13], not all refineries are designed to cope with all kinds of crude feedstocks nor can they necessarily produce every kind of product. Oil refineries are large and very expensive chemical plants designed for high-volume production of a particular product mix from a particular kind of crude. Re-purposing refineries for different feedstocks or product mixes is not always economically viable.
The oil production and distribution system is conventionally split into two (sometimes three) components
Much of the information in this and subsequent sections is provided by the extensive report into UK oil resilience prepared by Deloitte in 2010 for the UK Government Department of Energy and Climate Change (DECC)[13]. Where sources are not specifically mentioned it can be assumed that statements of fact made here are derived from that document. Some citations here refer to specific section numbers in that document for ease of reference.
Large reserves of oil and gas in the neighbouring seas supply much of the UK's oil and gas needs[16] although production from the North Sea is slowing towards the end of the second decade of the 2000s and the UK is now importing crude oil and certain refined products. Refineries in the UK produce much of what is needed for domestic use with significant over-production of gasoline, a slight under-supply of diesel and heating oil and a significant underproduction of aviation fuel. The number of refineries operating in the UK fell from 19 in 1975 to 8 in 2010, with further closures expected due to rationalisation in the industry and the opening of more efficient mega-refineries outside of the UK[13:1.1]. Indeed, the Coryton refinery closed in 2012 due to the bankruptcy of its operator[17].
In 2010, UK oilfields provided 32% of crude oil supplies, Norwegian oilfields 40%, Africa 12%, Russia 9% and the 7% balance coming from other sources. Readers may be interested to note that UK domestic consumption is not largely dependent on oil from the Middle East. DECC predictions on declining production in waters around the UK lead to a presumption of an increase in imports of crude oil from North and West Africa and the Caspian region or an increase in the import of refined oil, depending on the remaining level of refinery capability in the UK. This in turn means more dependence on oil landed ashore from ships rather than by pipeline, as at present from the North Sea fields (including Norway). A map of oil and gas pipelines together with ports of entry is available in the Deloitte report[13:p43]
Distribution of oil products in the UK is done through a mixture of pipelines, distribution centres and road transport. The pipelines and road transport have little spare capacity and so are potentially subject to short term shortages in the face of any disruption, exacerbated by demand spikes if drivers perceive a risk to supplies and decide to fill their tanks as a precaution.
Much of the Deloitte report looks at long-term shifts in production and refining capability and how markets would respond to those, raising questions about strategic industrial policy and the desirability of retaining refining capacity even if the individual owners and operators are disinclined to keep them going for narrow commercial reasons; also the implications of becoming dependent on lengthened supply chains and parts of the world which may be unstable or subject to political pressures. These are topics which are fascinating but fall well outside our concerns: emergency situations that pose significant threat to essentials for survival.
A range of plausible emergency scenarios are discussed in the Deloitte report[13:4.2] though the report accepts that it does not attempt to address very large scale events which border on the catastrophic such as a blockade of the Straits of Hormuz. Such an event, it is noted "would create intense pressure for a political response" which may well be coded language for a military intervention. For the near to medium term it is not obvious that such events form an immediate risk to supplies in the UK given the sources of crude oil and the national refinery capacity, though of course knock-on effects would be likely to have second-order implications.
Most of the emergency scenarios are, at worst, liable to lead to short-term inconvenience rather than severe shortages that would pose serious levels of threat. The industry is dispersed and the amount of trading that would be available to replace supplies makes it hard to see that unmanageable situations would arise, at least in normal peacetime conditions. A range of mitigation strategies are in place and have at times been at least partly tested. The International Energy Agency (of which the UK is a participating member) requires countries to hold 90 days of emergency stocks and coordinates release of stocks to help manage emergency situations[18].
In the case of fuel shortages, UK Government has emergency legislation in place to permit a national response with sharing of information on availability of stocks and coordinating supplies via the 'Downstream Oil Protocol'[19] as well as the National Emergency Plan for fuel allocation[20].
Further government thinking on fuel resilience can be found in a response to a fuel resilience consultation published in 2018 for BEIS (DECC having been renamed/reorganised)[21] which does not propose any radical changes to the status quo, though it proposes the establishment of a reserve tanker fleet to assist in physical distribution of oil supplies.
The importance of fuel supplies is such that UK Government has established plans to deal with plausible emergencies, furthermore, the UK is not at present seriously exposed to supply risk in most normal circumstances. Events that could change this situation would need to be of such a scale and so disruptive that the nature of the emergency is on a regional scale and not specific to oil. Oil would become a casualty and a contributory rather than a causal factor.
Should a severe and sudden situation arise which would cause the emergency planning to be put in place it seems reasonable to assume that there would be moderate to severe short-term disruption to normal life but that this would be due to planning and implementation deficiencies rather than lack of fundamental resources. As is mentioned in comments in the Cranfield Food Resilience report[22:4.2.2], the Priority User concept for fuel is a source of scepticism as to its fitness for purpose (this will be discussed elsewhere on this site).
Well-prepared people will wish to have mitigation strategies in place for short to medium term disruption to fuel and, consequentially, food and potentially other supplies.