Withdrawal of Gas in Germany Causing Price Increases and Industrial Risks According to Research Study

In a recent study published in the Tuesday edition of the "Handelsblatt" newspaper, it has been revealed that gas prices reaching 60 euros per megawatt-hour are causing negative profit margins for various industries in Germany.

The study provides specific examples of affected industries, including aluminum, basic chemicals, refineries, and paper production. In the paper production industry, a wholesale price of 60 euros per megawatt-hour leads to a negative profit margin, while at refineries and in the aluminum and basic chemicals industries, this price point results in similar financial repercussions.

The study also highlights the extent of involvement of German companies in gas contracts, with major energy companies like E.ON and its affiliates participating mainly within Europe. However, the study does not provide a detailed breakdown of their direct engagement in gas contracts by global regions. The context suggests that German energy firms operate largely within European frameworks and markets, with complex ownership structures influencing their operations domestically and regionally.

In comparison to Europe, India needs to purchase only 17% of its gas demand short-term, while China needs 12%. In contrast, 28% of current EU gas demand is not covered by contracts, according to the study. Europe's lack of commitment to gas supply contracts is a significant factor in higher gas prices, the study suggests.

Japan, on the other hand, has secured more gas at fixed prices than it needs, making it independent of short-term trading. This advantageous position is not shared by many European countries, as they struggle with the rising costs of gas.

The study, conducted independently, reveals that the shift away from gas is causing costly side effects for Germany. The exact industries that maintain positive profit margins at the given gas price are not specified in the study.

The study's findings underscore the need for careful consideration of energy policies and the potential impact on various industries. As gas prices continue to fluctuate, it is crucial for policymakers to address the challenges faced by these industries to ensure economic stability and growth.

Withdrawal of Gas in Germany Causing Price Increases and Industrial Risks According to Research Study