The Brief: Europe’s energy crisis will continue to linger as the US shale industry will not extend its oil and gas supplies to the region in winter. This was announced today as producers reiterated their stance against increasing production. Before the pandemic, the US supplied 13 million barrels per day, but investors have since adjusted to a low-supply model by curtailing daily production, ensuring higher profits. Surging energy costs all over Europe have brought speculations of imminent outages.
Why It Matters: This week, France and Finland warned their citizens and businesses to cut down on energy consumption in the coming months or they will be off the grid. This could be possible in the UK even if it produces its own gas. As wholesale gas and fuel prices continue to climb because of Russia’s decision to restrict its oil supply to Europe, Truss’ energy price guarantee for households is all set starting October. However, businesses will have to wait for their assistance until the details are ironed out by the government.
Finanze® Foresights: The global energy squeeze continues to threaten the recovery of many economies. Although Downing Street has assured the public in March that there will be no blackouts in the country during winter, the UK's reliance on foreign gas imports and limited gas storage continue to negatively affect its total power supply. The government must still implement measures to regulate the consumption of energy, particularly from industries that heavily depend on fuels, and accelerate its investments in alternative resources such as green electricity to compensate for supply gaps in the energy puzzle.
To the fullest extent permitted by law, Finanze Ltd are not responsible for any errors or omissions in any statements, views, opinions, facts, figures, commentary or any other material in the articles contained herein, or for loss arising from its use or performance, or for the results of any actions or lack of action taken on the basis of information provided in articles.
The topics covered in articles are complex and do not substitute the need for financial, legal, accounting, tax and other advice before making any decisions or taking any action based on information in articles.