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UK is EU's biggest producer of oil but production likely to fall, says report.

The UK needs to invest in energy infrastructure to 'decarbonise' its economy as oil and gas production begins to fall, according to a recent report.11 Mar 2016

The UK is currently the largest producer of oil and the second-largest of natural gas in the European Union, but investment in both industries is declining and this is likely to lead to lower production in future, the US Energy Information Administration (EIA) country analysis brief on the UK said.

The country switched from being a net exporter to a net importer of crude oil and natural gas in 2004 and 2005, respectively, and of petroleum products in 2013.

Production peaked in the late 1990s and has generally declined since then as discovery of new reserves has not kept pace with the maturation of existing fields, the EIA said.

The UK government has developed policies to address the decline in production, but the country needs large investments in energy infrastructure in order to decarbonise the UK economy, the report said.

Renewable energy use, particularly in the electric power sector, has more than doubled over the past decade, from 7% of total generation in 2008 to 205 in 2014, but petrol and natural gas continue to account for most of UK's energy consumption, the EIA said. In 2014, petrol and natural gas accounted for 36% and 33%, respectively, of total energy consumption. Coal also continues to be a significant part of total energy consumption.

Energy use per unit of GDP in the UK is one of the lowest among western economies. The UK has seen total primary energy consumption decline by almost 20% over the past decade. This has been caused by a reduction in energy-intensive industry, a contraction in the economy and improvements in energy efficiency, the EIA said.