“As we reach maximum oil extraction rates, the era of cheap oil is behind us. We must plan for a world in which oil prices are likely to be both higher and more volatile and where oil price shocks have the potential to destabilise economic, political and social activity. Virtually every sector of our economy is still dependent on oil. This is why it is vital that whichever party forms the next government, they have a coherent set of policies to help the UK adapt. This is especially important for the UK, and other developed economies, which have been so reliant on low-cost oil for decades. There are two challenges for government and policy-makers. Firstly, to recognise the situation we face, and secondly to take action to mitigate the worst implications of the crunch. Unless we do so, we face a situation during the term of the next government where fuel price unrest could lead to shortages in consumer products and the UKs energy security will be significantly compromised. This has the potential to hit UK business and commerce as well as the most disadvantaged in society with yet another crisis. While responsibility for addressing these changes must be taken up by government, we must also build a coalition of interests including businesses and the public if we are to implement the changes needed to help us adapt and prosper.”
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