Euro coins on gas plate, inflation illustration @BelgaImage
The numbers speak for themselves: the cost of living is increasing, and not just slightly. In its latest report, the Electricity and Gas Regulatory Commission (Creg) already shows that between November 2020 and November 2021, Belgian households had to spend an average of EUR 450 more on electricity and EUR 1,776 on heating gas. The sequel doesn’t look any better, on the contrary. With the Russo-Ukrainian war, the price rates that depend on these two countries panicked. From Russian gas to Ukrainian wheat and gasoline, inflation is raging. To realize this, nothing better than some graphics that are anything but encouraging as they are.
The insane rise of gas
The most glaring example that continues to fuel the debate is gas. As recently as July 2020, the price on the Dutch TTF futures market, which serves as a benchmark in Europe, was €5 per megawatt hour (MWh). An era more than over. Since then, the price has continued to climb, initially more or less moderately until mid-2021, then with impressive yo-yo effects. With the war in Ukraine, the rise forms a steep slope. At the beginning of March, the gas price is between 200 and 250 euros, with a very brief peak of a few hours even at 345 euros. Comparing that last figure to the initial €5 is a +6800% increase!
petrol and diesel
To fuel his car, the corner isn’t that crazy, but it’s still impressive. The maximum price for diesel in Belgium today passed the mark of €2 per liter and is now almost €2,084. A huge amount compared to April 2020 when it was worth €1,229. Admittedly, the price was relatively low back then because of the initial containment of the health crisis. Still, the difference is impressive. For unleaded 98 the price rose from €1,221 per liter in March 2020 to €1,977 on Monday.
A war that cuts the wheat supplies
The war in Ukraine is also clearly having an impact on the consumer goods side. Evidenced by the price of wheat, including Russia and Ukraine are among the largest producers in the world. At the beginning of March it is close to the €400 mark per tonne. Last July it was only 197 euros. In the US dollar market (see chart below) this equates to almost $1,200 a bushel (27.21 kg) today.
No nickel, no battery
Other products affected by the war in Ukraine include several metals, including nickel. The problem: Nickel, for example, is an essential raw material for the production of batteries for electric vehicles. Since Russia is the third largest producer in the world and oligarchs sometimes run the nickel companies, the sanctions have a direct impact. From $20,000 to $30,000 a ton before the war, the price rose at times to $100,000. On a daily average, the 50,000 mark is within reach.