Global record high natural gas prices are pushing some energy-intensive companies to curtail production in a trend that is adding to disruptions to global supply chains in some sectors such as food and could result in higher costs being passed on to their customers.
Some companies, including steel producers, fertilizer manufacturers and glass-makers, have had to suspend or reduce production in Europe and Asia as a result of spiking energy prices. That includes two of the world’s largest fertilizer-makers, which said they would cut production in Europe. The U.K. on Tuesday said it had agreed to provide state support to one of the companies to restart production of by-product carbon dioxide, which is used in food production, to avert a supply crunch.
Natural gas prices have risen sharply around the globe in recent months. That has been due to a combination of factors, including increased demand, particularly from Asia, due to a post-pandemic recovery; low gas inventories; and tighter-than-usual gas supplies from Russia.