Oil revenue 'highly volatile'

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Office for Budget Responsibility chairperson Robert Chote told the Finance Committee predicting North Sea oil receipts on a year to year basis was "extremely difficult and highly volatile".

Mr Chote was giving evidence on the UK economic and fiscal outlook on 17 April 2013.

He said the volatility was due to a "complex combination of determinants" including the level of oil and gas production, the prices of both, the dollar sterling exchange rate, expenditure and changes to the tax system.

The OBR predicted future oil revenues would be far less than the Scottish government's analysis.

It said oil tax revenue will drop from £6.7bn this year to £4.1bn by 2017-18.

The Scottish government predicted a "renewed oil boom" in its first Oil and Gas Analytical Bulletin predicts that production in Scottish waters could generate up to £57bn in tax revenue by 2018.

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