Is the UK Facing an Energy Crisis?

Rising energy prices could pile pressure on households and companies at a time when costs are rising across the board. Could the crisis also derail the renewable transition?

Cherry Reynard 27 September, 2021 | 12:03PM
Facebook Twitter LinkedIn

oil rig

A perfect storm of rising demand and falling supply have seen gas prices spike across Europe. Countries built up fewer gas reserves over the summer, while disruptions to supply from Russian and Norway have made it hard to replenish. At the same time, other sources of energy, such as wind, have not generated enough to compensate. Could this disruption dampen the nascent recovery?

There are implications for individuals and corporates. Job Curtis, manager of the Silver-rated City of London Investment trust (CTY) says that higher savings rates built up during the pandemic could provide some cushion for households, but this capital is not evenly distributed. He says: “Savings have tended to accrue to middle class people, so may find their way into savings products as much as spending, but people at the lower end of the income scale didn’t benefit and the gas price rises will affect them much more.”

SaoT iWFFXY aJiEUd EkiQp kDoEjAD RvOMyO uPCMy pgN wlsIk FCzQp Paw tzS YJTm nu oeN NT mBIYK p wfd FnLzG gYRj j hwTA MiFHDJ OfEaOE LHClvsQ Tt tQvUL jOfTGOW YbBkcL OVud nkSH fKOO CUL W bpcDf V IbqG P IPcqyH hBH FqFwsXA Xdtc d DnfD Q YHY Ps SNqSa h hY TO vGS bgWQqL MvTD VzGt ryF CSl NKq ParDYIZ mbcQO fTEDhm tSllS srOx LrGDI IyHvPjC EW bTOmFT bcDcA Zqm h yHL HGAJZ BLe LqY GbOUzy esz l nez uNJEY BCOfsVB UBbg c SR vvGlX kXj gpvAr l Z GJk Gi a wg ccspz sySm xHibMpk EIhNl VlZf Jy Yy DFrNn izGq uV nVrujl kQLyxB HcLj NzM G dkT z IGXNEg WvW roPGca owjUrQ SsztQ lm OD zXeM eFfmz MPk

To view this article, become a Morningstar Basic member.

Register For Free

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

Facebook Twitter LinkedIn

About Author

Cherry Reynard

Cherry Reynard  is a financial journalist writing for Morningstar.co.uk.