Rishi Sunak: EU embargo of Russian oil and gas will tip EU into recession

 

You couldn't make it up. On the one hand, Western politicians try to sound menacing and decisive and after speeches especially made with that purpose comes reality. Just a few days ago, German Chancellor Olaf Scholz raised the alert that such embargoes would seriously undermine the German economy. By extension if market prices go up, inflation will start to speed up in the EU and in the UK. Prices are no determined by particular countries. Prices are global. Only for this reason, there have been approaches to Saudi Arabia, United Arab Emirates and Venezuela to seek oil and gas production increases.

The Bank of England has just put up the basic interest rate on Thursday this week and announcing increases of interest rates would become the norm rather than the exception in months to come. Taking money away from peoples' pockets will curb consumption and curbing consumption means reduced economic activity. Reduced economic activity in turn means that with less demand many jobs will become redundant and jobs are being made redundant as you read both in terms of public jobs and private jobs. Why did a major ferry operator lay off 800 staff today? Is it because the company expects to have big earnings in the coming months? What about spring and summer when people tend go on vacation? Is it because they expect a reduction or an increase of the number of passengers wanting to travel to and from the continent?

The coming summer season could be a lot hotter and not just because of rising temperatures. Keep checking rising utility bills, travelling fares, fuel at the pumps and grocery bills.

The Fixed-Term Parliaments Act 2011 is said to be coming to an end. This will make the political situation a lot more fluid. But putting aside national elections, let's see what happens to the British economy from now until the May 2022 elections. Ordinary people are living under enormous pressure and such pressure is bound to be stronger if unemployment and inflation suddenly pick up. The combination of the two will be deadly.