The Rising Cost of Energy and Its Impact on Businesses
Former U.S. President Joe Biden is facing a worsening health situation after his son Hunter Biden said the cancer has spread to his bones and described the disease as "very painful" and "very debilitating."
When wholesale energy prices jump, businesses often feel it before households do, because many firms have no price cap to protect them. A British Chambers of Commerce survey of more than 800 firms found that 80% were already affected by the Iran conflict or expected to be, with manufacturing hit hardest, as 68% of manufacturers were already affected. Also, 43% of businesses expect their energy costs to rise by more than 20% over the next 12 months. (British Chambers of Commerce)
Business energy costs in the UK have surged by 25% since February, impacting firms beyond just bills. With few industries receiving government aid, higher energy costs have led to increased price expectations, from 3.2% to 5.1%, indicatingcustomers will end up sharing part of the burden. (SmartestEnergy) (CEPR)
IEA chief Fatih Birol has called this "the greatest energy security crisis the world has ever faced", adding that it will reshape global investment strategies. (Asia Economy)
So, what can companies do?
The OECD prioritizes policies that enhance energy efficiency and reduce dependence on imported fossil fuels, minimizing geopolitical risks and costs. Lower energy prices hinge on external factors like the Strait of Hormuz flows, making efficiency the most reliable strategy for businesses amidst uncontrollable market conditions. (OECD) (ING Think)
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