June 5 (UPI) -- Middle East geopolitical issues could present risks to the British energy supply, showing why London needs to capitalize on what's at hand, a trade group said.
Saudi Arabia and several other nations in the Persian Gulf region severed diplomatic ties with Qatar during the weekend, citing Doha's alleged support for international terrorism.
In a statement from the official Saudi Press Agency, the government in Riyadh said the coordinated move was because Qatar supported groups aimed at destabilizing the region, "including the Muslim Brotherhood, the Islamic State and al-Qaeda."
The fallout could have market implications as Qatar is a member of the Organization of Petroleum Exporting Countries and party to a multilateral deal to curb oil production to correct a lopsided market. Four of the six members of the regional Gulf Cooperation Council are OPEC members and the International Monetary Fund warned last year that exporters faced economic headwinds because of reduced oil export revenues.
The Persian Gulf nation is also the largest supplier of liquefied natural gas in the world and a trade group in London said the geopolitical row could have consequences for the British energy market.
Ken Cronin, the chief executive at trade group U.K. Onshore Oil and Gas, said the issue highlights why the British government should capitalize on the reserves it has under its own feet.
"According to the most recent government figures, nearly 30 percent of the gas we import comes from Qatar as LNG," he said in a statement emailed to UPI. "The energy losses associated with the liquefying, transportation across oceans and continents and regasification of imported LNG upon arrival add a large and unnecessary emission factor when compared to domestically produced gas."
Cronin's group at home has pressed most recently on the Scottish government to tap its own resources against "an extremely unfair depiction" of the onshore oil and gas industry in the United Kingdom.
Scotland has a moratorium in place on unconventional oil and gas extraction methods, like hydraulic fracturing.
The British government estimates shale basins in the country may hold more than 1.3 quadrillion cubic feet of natural gas, a level the government said could help an economy with natural gas imports on pace to increase from 45 percent of demand in 2011 to 76 percent by 2030.