Oil giants warn that Osborne's windfall tax could hit North Sea exploration - The Guardian

Drivers will not pay extra for their petrol as a result of the chancellor's windfall tax on North Sea oil , the energy industry has vowed, but the future of key parts of the economically vital sector is now in doubt.

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George Osborne announced the levy increase – a rise on the supplementary charge to North Sea oil and gas producers from 20% to 32% – in his budget, sending a shockwave through one of the UK's industrial powerhouses. He said the tax increase was needed to fund his cut of 1p in the duty on petrol. James Smith, UK chairman of Shell, dismisses as "nonsense" suggestions consumers could end up paying the extra cost of the tax, which Osborne said would raise about £2bn but independent experts have put at closer to £10bn. The industry will not be able to pass on the extra cost because the price of oil is set internationally, and the costs of North Sea oil form only a small part of that equation, he says.

Oil giants warn that Osborne's windfall tax could hit North Sea exploration - The Guardian