Ineos Halts Operations at Three UK Chemical Plants Due to Soaring Energy Prices
Impact of Energy Prices on Ineos and the European Chemical Industry
Background and Announcement
Sept 22 (Reuters) - Billionaire Jim Ratcliffe's Ineos said on Tuesday it was suspending operations at three chemical plants in Hull, UK, blaming high European gas prices that have made production too expensive.
Global Competition and Energy Crisis
European manufacturers have struggled to compete with U.S. and Chinese rivals since the energy crisis triggered by Russia's invasion of Ukraine and compounded by the Middle East war, leaving energy-intensive industries with far higher fuel and power costs than competitors in the United States and China.
Employment and Product Impact
The three plants employ almost 4,000 people and makes chemicals used in medicines, clothing, cosmetics, detergents, building materials and explosives, the company said.
Statements from Ineos Leadership
Chairman Jim Ratcliffe's Comments
"The European regulators need to wake up to the fact that the combination of high energy costs and the additional burden of unsustainable carbon taxes are destroying our European manufacturing base," chairman Ratcliffe said in a statement.
Comparative Gas Prices
"With gas prices now 12 times the level in the US and 8 times that of China, we just cannot compete," Ratcliffe added.
Market Data and Analysis
British gas prices on a front-month contract basis are currently trading at around $23.51 per million British thermal units (MMBtu), compared with $2.84/MMBtu for benchmark US gas at the Henry Hub, according to data from LSEG and the Intercontinental Exchange (ICE).
(Reporting by Atharva Singh in Benglauru; Editing by Nivedita Bhattacharjee)
