BP halts drilling over Iran sanction fears

BP has suspended drilling at a North Sea gas field it co-owns with an Iranian firm amid fears of a crackdown over US sanctions.

The oil giant is putting off drilling a new well at the Rhum field to avoid falling foul of the sanctions being introduced by the US after it pulled out of the nuclear deal with Iran.

The field accounts for about 4 per cent of North Sea gas production, and a new third well would increase that significantly. Current production is unaffected by the decision to postpone work due to start this week. It is the first major sign of the impact on UK businesses of the sanctions against Iran. Billions of pounds worth of deals struck with UK firms are potentially affected.

The delay to increased UK gas production comes at a time of heightened fears over our energy security. A recent cold snap left the UK and Europe increasingly reliant on gas from Russia.

BP said it is seeking clarity ‘on the potential impact of recent US government decisions regarding Iran’.