Ineos Pauses Hull Plants Amid UK Gas Price Crisis

Chemical company Ineos has paused production at its three plants in Hull, England, due to 'ridiculously high' UK gas prices. The move affects around 1,000 employees and could impact an additional 3,000 skilled jobs in the supply chain. Ineos owner Sir Jim Ratcliffe blamed the government's energy and tax policies for making the UK a less competitive place for manufacturers.

The company produces raw materials used in products such as pharmaceuticals, clothing, cosmetics, construction materials, and military explosives. Gas is used to power production processes at the plants, which have already ceased producing two key chemicals: acetic acid and ethyl acetate. The third plant will pause production within a few days.

The UK's natural gas prices have roughly doubled between July and September, reaching their highest level since December 2022. This increase has been driven by the US-Israel war in Iran and disruption to oil and gas supplies through the Strait of Hormuz. Sir Jim Ratcliffe warned that Europe's chemical industry is at a 'tipping point' and only urgent action can save it.

The government has responded with £350 million for strategically important chemicals producers, which will be available on a co-investment basis. Additionally, trade measures have been put in place to tackle foreign chemicals imports and high electricity costs.