Impact on the economy of recent energy price rises

  oresome 09:57 20 Oct 2013
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We are seeing signs of a recovery in the economy.

What impact will the rising cost of energy have on this?

People will have less to spend in the shops for one, so retailers will be hit. Less to spend on discretionary purchases like holidays so the tourist trade will be hit. Business costs will rise and so the end product cost will rise, suppressing demand or losing the competitive edge for exports.

Will you be cutting back and if so what will be the last thing you'll do without?

  chub_tor 10:15 20 Oct 2013

We have no mains gas here and electricity is a small part of our budget. We are seriously affected though by the price of oil and have seen some huge ups and downs over the past three years. Reasonably low at the moment but I follow Boilerjuice quite religiously, trying to guess the trend so I know the optimum time to fill the tank.

At this stage we have no plans to cut back but the last thing we would do without is visits to the USA to see our daughter. We might have to cut down on the frequency and choose cheaper carriers but it would be heart wrenching not to see her at least once a year.

  john bunyan 10:28 20 Oct 2013

We cannot have it all ways. We have become more and more dependant on imported oil and gas, which are subject to prices that the energy companies cannot control. They do not make an excessive return on investment by international standards and if the government try to make unreasonable capping demands, the companies will either stop supplies or stop investing in the future (vital as coal fired stations coming off line). Nuclear is a vital stop gap and so is fracking. Those who oppose fracking are cutting off a home supplied resource that we urgently need to have. Wind is a waste of time (what happens in calm periods?) We seem to be very reluctant to go for sea power (Severn Barrier) .

  fourm member 11:04 20 Oct 2013

Like chub_tor, we have oil heating so movements in the gas price don't affect me.

When we moved here, 12 years ago, we filled the tank for 11p a litre. My latest was 68.3p.

I've changed some things, like not using the lounge and wearing more clothes, but I haven't made drastic changes to save fuel.

I accept that there are those for whom energy price rises are a burden but, for many, one less pint of beer a week is all it takes.

As for the original query, energy price rises won't affect economic growth because they are part of GDP. That's what makes GDP a poor measure of what is going on. They might impact the publican if all his customers cut back by one pint a week but the total number isn't affected.

  oresome 11:21 20 Oct 2013

Like chub_tor, we have oil heating so movements in the gas price don't affect me.

I believe there is quite a strong correlation between gas and oil prices so it's unlikely you will avoid the impact for long unfortunately.

  Algerian peter ™ 11:42 20 Oct 2013

Like the rise in the petrol price it will be good news for the exchequer because when the price goes up so does the amount paid in vat.

  chub_tor 12:51 20 Oct 2013

fourm member just for reference I am waiting for a delivery of 800L from Boilerjuice purchased at 55.49p per litre ordered just a few days back. I flit between Boilerjuice and Direct Oil depending on price and delivery.

  cream. 13:02 20 Oct 2013

chub_tor

Arranged price and delivery for a disabled old age pensioner we keep an eye on. Filled tank @ 57.5p a litre. You can see the refinery from his bedroom window.

  fourm member 13:02 20 Oct 2013

oresome

All energy prices are related, of course. I was meaning more all the talk about the 'green' elements of gas pricing and political claims to be able to control the price.

chub_tor

I know the oil price has fallen recently. Just my bad luck. It does show, however, that energy prices do go down as well as up.

  woodchip 14:47 20 Oct 2013

For me its a load off cobblers saying that prices are going up as a result of providing Electric cables etc. Its just another way of getting more money for shareholders. The Technology exist to make power at reasonable cost, but that will not fill the purses of greedy people

  wee eddie 14:54 20 Oct 2013

I'm a Shareholder and my Pension is reliant on the Dividends I receive

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