Aberdeen, once heralded as Scotland’s “oil capital,” is experiencing a marked economic decline as the North Sea oil and gas sector continues to contract. Long a hub for the industry, the city has seen rising unemployment and widespread business closures over the past decade, contributing to what residents describe as a sense of stagnation and uncertainty.
The downturn traces back to a sharp drop in oil prices around 2014, when crude fell to roughly $23 a barrel—less than half of current levels—resulting in the loss of nearly 9,000 jobs in the sector over ten years. Many shops along Aberdeen’s main commercial artery, Union Street, remain shuttered, reflecting the city’s ongoing struggles.
In November 2025, the UK government, led by the Labour Party, implemented a key manifesto pledge by halting the issuance of new oil and gas exploration licenses in the North Sea. Existing operations are allowed to continue until their natural end, but no new drilling projects will be approved. Despite international events such as the closure of the Strait of Hormuz following a military strike by former US President Donald Trump on Iran—which caused global energy prices to spike—Energy Secretary Ed Miliband maintained that transitioning to renewable energy sources remains vital for the country’s long-term energy security.
The political ramifications of this policy shift have been felt strongly in Aberdeen, where the Scottish Conservative Party recently marked a rare by-election victory in the area. Tory MSP Douglas Lumsden won the Aberdeen South seat previously held by an SNP member, buoyed by a campaign promising to revive the oil and gas sector by easing regulatory and tax burdens. Conservative leader Kemi Badenoch actively campaigned in the city, criticizing Labour’s net-zero ambitions and advocating for increased fossil fuel production.
Other political voices, including Reform UK, have also urged greater North Sea exploitation to reduce domestic energy costs. However, numerous experts argue that since oil prices are set on international markets, expanding production domestically would not directly lower consumer bills. Many residents express frustration over what they perceive as political posturing, emphasizing the complexity of the city’s challenges.
Signaling a broader recognition of the economic transition underway, Labour politician Andy Burnham has called for devolved powers aimed at supporting regions facing industrial restructuring, naming Aberdeen specifically. The government’s Great British Energy firm, focused on renewables such as offshore wind and green hydrogen, is headquartered in Aberdeen, reflecting efforts to position the city as a centre for clean energy development.
Local perspectives illustrate the tension between economic reality and environmental goals. Former oil platform inspector Colin, 62, advocates for sustaining the oil industry in the near term to preserve jobs and reduce reliance on imports, citing Norway’s expansion of North Sea drilling as a contrast to Britain’s approach. Energy policy experts emphasize the ongoing reliance on oil and gas globally and suggest that continued domestic production may be necessary even as the UK pursues a green transition.
As Aberdeen navigates this period of significant change, its residents and political leaders remain divided over the future role of oil and gas in the region’s economy, balancing nostalgia for past prosperity with the demands of a shifting energy landscape.