North Sea oil & gas companies made the lowest profits in nearly five years during the first quarter, according to data from an official UK survey.
The UK’s Office for National Statistics said its latest quarterly poll suggested the rate of profit at firms exploring for and extracting oil & gas sank to 27.6% in the first quarter, down from 31.1% in the last three months of 2013.
The profitability rate, which is based on the net rate of return from capital invested, was at its lowest since the second quarter of 2009, ONS said.
“Activity in the oil & gas extraction sector increased by 0.8% in Q1. However the industry has been in long-term decline, contracting in every year since 2002,” the statistics organisation said.
“The rates of return for this industry broadly follow movements in oil & gas prices...and can be very volatile,” ONS said.
For the report, each quarter the statistics body surveys a sample of 1650 companies divided between a broad range of sectors in the UK economy including oil & gas.
The oil & gas profitability rate remains much higher than the overall economy, which slipped from 12.1% in Q4 2013 to 11.9% in the first three months of the year, the survey said.