The fact that the oil and gas industry in Scotland is in crisis is beyond doubt – the only question now is its scale of the problem. When the oil price first began to fall seriously at the end of last year, there were warnings from industry experts and politicians that the job losses could be more severe than Ravenscraig. The latest assessment from the trade association Oil and Gas UK is that the price drop has already cost 5,500 jobs and that many more will go in the coming years.

The slight recovery in the price offers a little hope, but it is not enough to change the grim reality: exploration is at its lowest level for decades, investment is stagnating with many projects put on hold, and employers such as BP and Total have cuts jobs as well as dramatically cutting back on the hours and pay of many of those staying on. With no serious prospect of the price rising to the highs of two years ago, a plan must be made for a $70 future.

Some of the elements of that plan are in place. In the Budget in March, for example, the Chancellor overhauled the tax regime for the sector, including making a cut to the supplementary charge for oil companies from 30% to 20%, which was the right decision for the industry. Some new projects will remain unviable, but the more generous tax arrangements are likely to help in the medium term by making some further exploration financially viable again.

The UK Government's Energy Bill also has some good news for the sector. The cut to subsidies for onshore wind farms is a serious blow to an overall coherent energy strategy, but it does at least formally establish the Oil and Gas Authority recommended by Sir Ian Wood's review. It also gives the new independent body the powers needed to drive greater collaboration in the industry, which, in straitened times, offers the best hope for new investment and new jobs.

And the prospect of a turnaround in the longer term remains realistic, not least because the oil price has been through many fluctuations before. A vast swathe of the oil and gas in the North Sea also remains unexploited and it is there for the taking in years to come. But it will only happen if the right structure is in place to encourage investment and exploration. It is also only one part of a much bigger picture that should include a mix of energy including wind, wave and nuclear as part of a decisive move towards renewable and away from dirty fossil fuels.

The Scottish Government has a central role to play in all of this. It was happy to trumpet the oil and gas projections ahead of the independence referendum, but now that the picture is bleaker, it should tell us what it thinks is the way forward rather than simply blaming the UK Government. More investment to grow renewable capacity, particularly wave, would be a start, but in the shorter term oil and gas firms also need support and encouragement to work much more closely together to boost production and investment. North Sea exploration is at a new low, with terrible consequences for the men and women who have lost their jobs and livelihoods, but with some fundamental changes to the sector, the industry still has great prospects.