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British Prime Minister Boris Johnson promised on Monday that the government would do everything it could to prevent energy suppliers from going bankrupt in Europe’s natural gas shortage.
According to the UK’s marine oil and gas industry group OGUK, wholesale gas prices have skyrocketed 250% since January and rose 70% in August alone.
CF Industries, a US fertilizer producer, has announced that it will suspend production in the UK due to price increases. The food industry, which relies on CO2, a by-product of fertilizer production, has also warned of problems ahead of the Christmas season.
Small energy suppliers are reportedly at risk as one of the big companies, Bulb, is looking for a bailout.
During his trip to the United States, Johnson said the lack of natural gas was due to the resumption of the economy after it was blocked during the CCP (Chinese Communist Party) virus pandemic.
“It’s like coming back to put a kettle at the end of a TV show. It’s putting a lot of stress on the world’s supply system,” he told reporters who accompanied the UN General Assembly in New York.
The Prime Minister told broadcasters at the JFK airport tarmac that people “should be reassured” that the problem of energy shortages is short-term and not unique to the UK. ..
“This is really a function of the world economy that awakened after COVID,” he said.
“We must try to fix it as soon as possible. Make sure we have the supplies we need and make sure that the company we depend on does not allow it to fall. You have to do as much as you can. “
“But this will get better as the world economy recovers and markets begin to clear up.”
His comments were made when the government was under pressure to lift energy price caps.
“Ask for trouble”
Chris Burke, Chief Operating Officer of Colorado Energy, which powers 15,000 customers, told BBC Radio 4’s “World at One” program that the recent rise in wholesale prices is “unprecedented.” rice field.
“Anyone who runs a small store can understand. The beans I sold yesterday were 20p and now they are 80p cans and I can’t change the price to the customer. I have a problem. There is a possibility, “he said. He added that he wasn’t sure if his company would survive.
If an energy supplier goes bankrupt, its customers are usually picked up by an alternative supplier appointed by the energy regulator Ofgem.
However, due to soaring costs, the rest of the companies are hesitant to accept these customers.
Dale Vince, CEO of ecotricity, a green energy supplier, said taking on customers in a collapsed company means “seeking trouble.”
Vince talked about the BBC’s “Today” program, saying that the price cap “allows energy companies to have a margin of about 2%, which is choking.”
“We impose a government stealth tax of 25 percent on the electricity bill of everyone who really needs to get rid of it, and of course we rely on foreign markets for oil and gas,” he said. Said.
“We need to build renewable energy as if there is no tomorrow. In the next decade, we will not rely 100% on energy in our country for electricity and gas. It may be. “
Downing Street currently states that there are no proposed changes to the energy price cap.
A Johnson spokesman said, “As I say, price caps have been maintained to protect consumers from sudden rises in global gas prices and save them money this winter. “.
He sought to see if the cap could change between October and the next review date in April 2022, adding that he “doesn’t know of a proposed price cap change.”
Foreign Minister James Cleverly previously told Times Radio that there is no price cap to “prevent a permanent price increase” prior to the 12% price increase scheduled for October 1. , “These price increases are modest and predictable.”
In addition to the surge in demand as the country breaks out of the blockade, the shortage of natural gas is also due to the burning of large inventories last cold winter and the decline in supply from Russia.
Asked if the government thinks Russia is involved in gas price fixing, No. 10 points out “rising European and global gas prices,” and Britain relies on Russia’s gas supply. He said he didn’t.
“We meet half of our annual supply through domestic production and most of our imports come from supplies such as Norway. I believe that in 2020 less than 3 percent of our gas came from Russia. “I will,” said the spokesman.
Executive Secretary Kwasi Kwaten said on Sunday, Britain said [energy] supply. “
PA contributed to this report.
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