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Crude awakening: Trump fuels pressure on Labour’s North Sea policy

When President Trump landed at Prestwick Airport on Thursday, he greeted the Secretary of State for Scotland, Ian Murray, with a firm handshake, a steely gaze and the words, “Mr. Secretary”.

Few people then would have realised just how seismic the President’s visit to Scotland – notionally to open a new golf course at his resort in Aberdeenshire – would be. But in four short days the American leader has placed Scotland at the centre of the diplomatic world, with decisions made at Turnberry and then Menie having potentially serious consequences.

Much of the focus of the visit will, of course, be on the international ramifications. One of President Trump’s first acts was to sign a trade deal with the European Union after in-person negotiations with Commission President Ursula von der Leyen, as well as signal his growing concern about the crisis in Gaza. Meanwhile, the President also indicated his – admittedly somewhat vague – intention to ratchet up pressure on Vladimir Putin, suggesting the Russian leader has perhaps 10-days to negotiate a ceasefire in Ukraine or face severe secondary sanctions.

President Trump did not, however, limit his interventions to geopolitical affairs, and the impact of his visit may be keenly felt on the domestic front too. Among the leaders to come and pay homage to the US President was Sir Keir Starmer, with one commentator noting that the Prime Minister was left looking like a visitor in his own country.

Following their engagement, the US leader took aim at the UK Government’s attitude to the North Sea, describing the oil and gas industry as a “TREASURE CHEST [original capitalisation]” and urging ministers to “incentivise” investment in the basin.

The social media post echoed comments he made to the press during his visit, and will place additional pressure on the UK Government to change tack on the fiscal regime in the North Sea.

Certainly, despite their obvious differences in personality and politics, the US President and Prime Minister have struck up a genuine working relationship, with Sir Keir Starmer showing he is willing to placate his American counterpart where needed. Even during their meeting, as President Trump restated his support for oil and gas to the press, the Prime Minister was quick to agree the industry would be “with us for a very long time” as part of a “mix” including offshore wind and other sources. The problem, of course, is how the government will achieve that desired “mix” while simultaneously stifling new investment in the North Sea.

Equally, the government has also shown itself willing to consider changing domestic policy – such as continuing to hold informal talks on scrapping a tax on US social media giants - to maintain cordial relations with the Trump administration or win concessions elsewhere.

Given President Trump’s oft mentioned affinity with iconic Scottish industries – again reiterated on this trip – changing the tax regime in the North Sea would be an obvious place for the UK Government to start.