Log in
E-mail
Password
Show password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON
News: Latest News
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 
All NewsEconomyCurrencies & ForexEconomic EventsCryptocurrenciesCybersecurityPress Releases

UK vows to manage fallout from soaring gas prices

09/18/2021 | 03:19pm EDT
A warning label is seen on the front of a gas meter at a house in Manchester

LONDON (Reuters) -Britain said on Saturday it would work with the energy industry to try to stem the fallout from soaring gas prices after fears grew that more energy providers and food producers would struggle to operate with such high costs.

Business minister Kwasi Kwarteng said he had been reassured that the security of gas supply was not a cause for immediate concern but he would work with providers to "manage the wider implications of the global gas price increase".

Kwarteng held emergency talks with executives from National Grid, Centrica, EDF and the regulator Ofgem on Saturday and is due to hold further discussions with industry figures on Sunday and Monday.

A jump in gas prices has already forced several domestic energy suppliers out of business and has shut fertiliser plants that also produce carbon dioxide, used to stun animals before slaughter and prolong the shelf-life of food.

Consumer groups and opposition politicians have warned that some customers and businesses will struggle to pay higher bills. The BBC reported that at least four small British energy companies were expected to go bust next week.

The Business department said the pressures facing companies was discussed during the meeting. Kwarteng said no customer would go without gas or electricity because an alternative supplier would be found if one went bust.

"Protecting customers during a time of heightened global gas prices is an absolute priority," he said on Twitter.

RENEWABLES

The government has been moved to act after low gas storage levels, decreased supplies from Russia, demand from Asia, low renewables output and nuclear maintenance outages combined to more than triple European gas prices this year, hitting record highs.

The impact was immediately felt in the UK food sector where the shortage of CO2, also used in beer, cider and soft drinks, compounded an acute shortage of truck drivers, which has been blamed on the impact of COVID-19 and Brexit.

Nick Allen of the British Meat Processors Association said on Saturday the pig sector was two weeks away from hitting the buffers, while the British Poultry Council said its members were on a "knife-edge" as suppliers could only guarantee deliveries up to 24-hours in advance.

"Doing nothing is not an option," Allen told Reuters, adding that given the exceptional circumstances, the government needed to either subsidise the power supply to maintain fertiliser production or source CO2 from elsewhere.

Richard Walker, managing director of Iceland Foods, said a CO2 shortage would hit meat products, atmospheric packaged products such as cheese and salads, and long life bakery items.

"We need to sort it, quickly," he said.

Dermot Nolan, former head of Ofgem, told the BBC he expected prices to stay high for up to four months and it was not clear what the government could do to affect market rates - meaning they will remain a focal point in the run-up to the COP26 climate conference in Scotland in November, where governments will seek to agree new rules to suppress emissions.

(Reporting by Kate Holton; Editing by Edmund Blair, David Holmes and Gareth Jones)

By Kate Holton


© Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
EURO / BRITISH POUND (EUR/GBP) -0.23% 0.8435 Delayed Quote.-5.67%
FEEDER CATTLE?FUTURES (GF) - CMG (ELECTRONIC)/C1 -0.02% 155.725 End-of-day quote.13.40%
LINK REAL ESTATE INVESTMENT TRUST 0.29% 68.4 End-of-day quote.-3.12%
LIVE CATTLE (LE) - CMG (ELECTRONIC)/C1 -0.06% 125.375 End-of-day quote.11.07%
Latest news "Economy & Forex"
03:01pU.S. Coast Guard boards ship in connection with California oil spill
RE
03:00pFed's Waller says high inflation through year end may need 'aggressive' response
RE
02:59pALPHABET : Google announces Pixel 6 phone with new chip, subscription service
RE
02:57pWall Street rises as investors bet on positive earnings season
RE
02:56pWall Street rises as investors bet on positive earnings season
RE
02:55pImf chief economist gita gopinath plans to rejoin harvard early next year - bloomberg news
RE
02:55pIMF Chief Economist Gita Gopinath Plans To Rejoin Harvard Early Next Year - Bloomberg News
RE
02:53pU.S. Treasury will hold IMF chief accountable for integrity changes -official
RE
02:50pBrazil central bank intervenes in FX market rattled by new spending
RE
02:40pGE mandates COVID-19 vaccines for U.S. workers
RE
Latest news "Economy & Forex"