OFFSHORE firms will make more redundancies due to the low oil price, an industry body has warned.

Oil & Gas UK says companies remain under pressure and will be forced to cut jobs in the coming months.

The warning came despite an increase in production, with numbers showing work lifted by around eight per cent last year.

However, firms are being forced to cancel or postpone projects and have had to pare back workforces as they fight the impact of oil’s low value.

Latest figures show the price of oil stands at about $38 a barrel (£25), which is well below historic levels amid an oversupply of stock.

Deirdre Michie, Oil & Gas UK chief executive, said 2016 will be another tough year.

She said: “Government data for the first 10 months of 2015 shows the total volume of oil and gas produced on the UK Continental Shelf was up 8.6 per cent compared with 2014.

“Given the difficulties being faced by the industry this is welcome news, but the fact is the value of our product has more than halved.

“Times are really tough and we will continue to see job losses.

“We have to be resilient and focus on what we need to do to get us through the coming months to ensure an enduring industry for the future.”

Ms Michie said one of the areas capable of helping the sector address its slump was the supply chain.

She added: “We continue to have a supply chain that is the envy of the rest of the world as a centre of excellence.

“It generates tens of billions of pounds and has a workforce whose skills will be critical in helping us unlock the remaining barrels on the UK Continental Shelf.

“With up to 20 billion barrels of oil and gas estimated still to recover, there is good opportunity ahead.”