Ex-war populations are too big a problem in Ukraine. As if inflation and the constant threat of escalating conflict weren’t enough, we can now add Europe’s energy crisis to the challenges posed by the Russian invasion to US consumers
Few global events have illuminated the world’s delicate energy ecosystem like the conflict in Ukraine. When Russia followed through on its threat to stop the flow of natural gas through the Nord Stream 1 pipeline – the largest natural gas pipeline to Europe – it fueled long-standing fears about the downstream consequences of the war for energy consumers in the SA and elsewhere.
From fine dining to fertilizer, it’s harder and harder to escape the fallout.
Michelin-starred chef Tom Kerridge recently announced a seven-fold increase in utility costs at one of his smaller locations, warning that other locations could shut down popular bars and restaurants in the winter.
Kerridge blames the possible shutters on Europe’s failure to introduce caps on energy prices, which have been extremely volatile since the invasion and the subsequent shutdown of natural gas flows through the Nord Stream 1.
But the problems go deeper than first class food.
Gas prices in the USA
The Nord Stream cut has forced Europe to shop the global market for gas supplies. Global players, including the United States, have increased the amount of liquefied natural gas sent to Europe.
A decline in domestic stocks means higher prices in the United States, and ultimately, American families will feel that. About half of US homes rely on natural gas for heating.
Travelers heading to Europe this fall or winter should manage their expectations.
In Germany, for example, energy consumption curbs mean lights go out earlier in the evening, swimming pools go unheated, hot water could be rationed and rail travelers could see increased waiting times for trains that surrender transport of coal or of higher priority. oil
Beer, wine and … fertiliser?
As Europe heads into winter, it may be harder to find pockets of the European economy – including goods normally shipped to the US – that will not be affected.
The continent as a whole is facing a major energy crisis. Unprecedented heat conditions this summer affected hydroelectric power output, curbing nuclear power output and raising demand for cooling.
Almost 60% of British manufacturers expect to close due to higher energy prices, according to a poll by UK manufacturers’ organization MakeUK
In Spain, the price of cement has risen by 400%, forcing many factories in that country to cut or close production.
One player that is often lost in the global economy is fertilizer, and a stoppage of natural gas supplies in Europe will put fertilizer stocks at risk. Nitrogen-based fertilizers are the most common, and ammonia — which requires large amounts of natural gas to make — is a key component of those fertilizers.
The vital role of natural gas could hit everything from auto parts to beer and wine drinkers, as its role in glass production comes into new focus. Glass making relies heavily on natural gas-fired energy to melt sand, soda ash and limestone.
What to read next
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.