According to Bloomberg, smelters and chemical plants across Europe were already struggling before the invasion caused another jump in gas and electricity prices.
Now, the list of companies warning that the energy crisis will continue to hurt their bottom line for the foreseeable future is growing, including Europe’s largest chemical maker BASF C.
“Energy prices will remain at a high level and will not return to normal soon,” said Martin Brudermiler, CEO of Germany’s BASF.
BASF has already lost 800 million euros ($900 million) due to rising gas prices in the fourth quarter of last year, and the situation could worsen if the United States and Europe expand sanctions against Russia, which supplies the European Union with more than 40% of its natural gas needs.
“It will be very difficult to replace Russian gas with LNG from elsewhere,” Brudermüller said.
It is noteworthy that BASF is not alone, as the energy-intensive mineral industry is also suffering.
Aluminium, Dunkirk Industries France, Europe’s largest aluminum smelter, had planned to ramp up production after helping the French government shoulder up to 80% of the cost burden, but a trade union official said the new price hike after Russia’s invasion of Ukraine halted the plan.