Many fertilizer and energy businesses in the UK had to close due to the impact of high gas prices.
Europe is facing an energy crisis that causes gas, gasoline and electricity prices to rise, especially in the UK. The price of gas for November delivery on the TTF of Netherlands was at 97.7 euros/MWh on October 1, an increase of about 400% since the beginning of the year.
This crisis has not only affected production but also turned the lives of British people upside down.
A series of businesses closed or faced difficulties
Rising gas prices have forced the closure of two UK fertilizer plants, leaving food producers short of the carbon dioxide by-product, which is used to stun livestock before slaughter and for packing food by vacuuming packs to extend shelf life, as well as to aerate beer and soft drinks.
The skyrocketing commodity prices also led to more defaults in the energy sector. According to a report from Cornwall Insight, in the fourth quarter of 2020, the six largest UK companies supply up to 99.5% of energy for the domestic market. By the second quarter of this year, that number dropped to 69.1%.
Start-up Bulb, Britain’s sixth-largest gas supplier, is asking for a bailout, while four of Bulb’s smaller competitors recently stopped trading.
The chief executive officer of Green Energy, one of the UK’s emerging companies, said the business prospects of these companies were bleak and urged the government to help small companies. According to CEO Green, most small energy companies do not have ample capital to continue operating in the context of rising costs.
People are short of gas and “suffering” because of high gas and food bills
High gas prices lead to higher gasoline and carbon dioxide prices, depleted supply, in addition to the reason for the shortage of personnel in the UK post-Brexit.
On September 30, the British Petroleum Retailers Association (PRA) said that petrol stations are still in a state of running out of fuel. PRA said that the number of retail gas stations running out of supplies still accounted for 27%. And in fact, lines of cars are still lined up at petrol stations across the UK waiting to buy fuel. To relieve pressure at fuel stations, the British government sent soldiers to transport fuel for civilian purposes.
“About 200 troops, including 100 drivers, will be deployed to support the temporary transport of fuel,” the British government announced on October 1. It is expected that the army will officially enter the army from October 4.
In addition to gasoline shortages and rising food prices, around 310,000 UK households will face a gas bill that will rise by up to 11.5% in the coming months. Severe carbon dioxide shortages are having an impact negatively affect the meat processing industry, pushing up pork and chicken prices. Food industry officials also warned meat processing plants could have to stop production for one to five days if the carbon dioxide shortage persists. The UK may have to cull 150,000 pigs during this crisis.