With the oil price at its current low, an independent Scotland would face a fiscal “chasm”by George Magnus / January 4, 2016 / Leave a comment
The deteriorating relationship between Saudi Arabia and Iran may have global implications of huge importance—but what, you might ask, does it have to do with the lurking issue of Scottish independence and this year’s Holyrood elections on 5th May? The answer is oil, which is the basis of the economics of independence.
To understand this better, cast your mind back 16 months to the independence referendum. It was rejected by 55-45 per cent, but the issue clearly hasn’t gone away. Nicola Surgeon, the First Minister told her party conference last October she didn’t envisage another referendum before 2021, but conceded there might be, for example, in the event of a “leave” vote in the UK’s forthcoming EU referendum. When the votes were cast in 2014, the price of a barrel of Brent oil was still over $100. Today it is less than $40. This weekend, Sturgeon launched her party’s Holyrood election campaign, calling for a “renewed” drive towards independence. So how will oil influence political debate in Scotland in 2016?