Editorial note

An editorial look at Washington's offshore lease expansion under Big Beautiful Gulf 1 and Britain's windfall tax and its effects on investment

US expands offshore leases as UK windfall tax hits investment

The White House has scheduled the inaugural sale under the Big Beautiful Gulf 1 law for December this year. More than 30 federal lease sales are planned over the next 15 years. The plan sets a minimum pace: the Gulf of America must hold at least two offshore lease sales by 2039, starting in 2026, and Alaska's Cook Inlet at least six offshore sales before 2032. There will also be quarterly onshore sales in western states.

In Britain, operators warn that the windfall tax remains punishingly high. Ithaca Energy and other operators urge changes to the 38 percent Energy Profits Levy or its removal. The levy is designed to kick in when oil and gas prices rise; it would expire if prices stay below set thresholds for six months. Oil has traded under those levels for months, complicating investment signals. Projections suggest current net zero policies could cost up to 1,000 industry jobs per month through 2030, a figure critics say reflects a broader mismatch between climate goals and energy security.

The US strategy uses a long horizon to signal stability in access to public energy resources. By scheduling more than 30 lease sales over 15 years, Washington bets that predictable procurement can fund programs and spread risk, even as prices swing and environmental rules evolve. The approach treats public land as a long-term revenue stream and a tool for energy sovereignty, not a mere catalyst for near-term drilling.

The UK situation exposes a clash between revenue needs and market confidence. A steep windfall tax can quickly drain investor appetites and raise the cost of capital for new projects, undermining energy security just as prices rise. The contrast between US expansion and UK tax policy highlights a wider debate: should governments use fiscal instruments to harvest windfall profits or to nurture steady investment in a low-carbon transition? The answer will shape jobs, prices, and political support for years to come.

Highlights

Policy clarity and market signals will determine whether these plans translate into real energy security and steady jobs.