If you’re looking at your weekly shop and wondering why everything seems to cost double when your wages haven’t increased… There’s a simple answer to that, but nothing in the way of an easy solution right now.
As we all know, Russia and Ukraine are currently at war. But why does that affect us and the price of your loaf of bread? Well, Russia and Ukraine are responsible for a significant amount of our grain and oil imports, among other things.
Most of our oil is imported from Norway, but 9% of our oil import in 2021, was Russian. 27% of our coal import the same year was also Russian.
With Russia at war with Ukraine, which we also import from, and the rise of demand with the recession “recovery” post-Covid, prices have skyrocketed for everything from grain to oil. Which brings us to where we are today – at an inflation high of 40 years and a food inflation high of 45 years.
This is nothing new. The cause of the oil crisis in the 70s started with the Yom Kippur War when an embargo was placed on the UK and any other states supporting Israel in the war. This caused an energy crisis as the price of oil rose and, with it, the cost of basic necessities and utilities.
With the current government recommending against an increase in wages, warning that it may increase the price of products further, it looks like it may be a while before we no longer feel the pinch.