‘Just worry upon worry’: Europe faces a bleak winter as supply shock pushes factories to the brink
From Shropshire to Hamburg, depleting reserves and spiralling costs are spawning a continent-wide energy crisis
TL;DR
- Soaring natural gas prices, doubling in two months, are creating significant stress for industrial businesses across Europe.
- Bridgnorth Aluminium in the UK faces an 18% increase in its monthly gas and electricity bill, with concerns about customer retention as contract price adjustments come into play.
- Europe is heading into winter with gas reserves at their lowest in over a decade, with countries like Germany and the Netherlands failing to meet storage targets.
- German 'Mittelstand' companies are struggling with high energy costs, which are considered a fundamental production input, leading to warnings of companies going out of business and work moving to Asia.
- The chemicals sector is particularly exposed, as gas is used for both power and as a feedstock, leading to production output falls and potential plant closures in the UK and Italy.
- The ongoing energy crisis is making investment in European industries challenging, with business conditions rapidly changing due to factors like Brexit, the Ukraine conflict, and the pandemic.