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13 April 2012 | Adam Leach
Predicted rises in energy prices could cost European businesses an extra €4.6 billion (£3.8 billion) this year, according to EnergyQuote JHA.
Research by the energy analyst attributes the majority of the rise - €4.5 billion (£3.7 billion) - to a forecast increase in the price of wholesale gas. Other power price increases contributed just €100 million (£82 million) to the total amount that will cost companies across the EU. EnergyQuote JHA forecasts UK businesses in the UK will face gas price increases of up to 15 per cent, with the expected rise across the EU ranging from 9 to 14 per cent.
Gary Worby, managing director at EnergyQuote JHA, said: “The sheer magnitude of these numbers show that it is more important than ever before for industrial energy buyers to take full advantage of the range of risk and procurement tools available to them.”
The forecast rise in gas prices is attributed to a number of factors but the research identified growing demand for the fuel source in Asia as the main reason. An increase in the cost of power generation feedstock, crops and products such as vegetable oil that can be converted into fuel, was also highlighted as important.
Last month, Bank of America Merrill Lynch issued a similar warning that European buyers are being “squeezed out” of the market for liquefied natural gas supplies due to rising demand in Asia.