Accelerating the decline of Scotland’s oil and gas production will do more environmental damage and weaken the economy, according to a report commissioned by the Scottish Government.

The report warns that Scotland will need to “carefully manage” the transition to the low carbon sector in order to “minimise any negative impacts” on society and the economy.

Offshore Energies UK, which represents 400 companies involved in producing energy from gas, oil, wind and hydrogen, says the new analysis reaffirms the ongoing need for domestic production as Scotland transitions to lower carbon forms of energy.

The report is published as Shell’s new chief executive said he is considering ditching plans to reduce its oil output this decade, declaring that it is “not healthy” to cut production.

Europe’s biggest oil and gas group said two years ago that its oil output had peaked in 2019 and would decline by 1 to 2% each year until 2030 as it sold off assets.

But Wael Sawan says the company is now “reflecting on what is the right guidance to the market”, because it had made steeper cuts than were anticipated since the target was set.

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