Billionaire Sir Jim Ratcliffe is suspending operations at three of his chemical plants over “ridiculously” high gas prices.
Industrial giant Ineos has struggled to compete with the US and China since the energy crisis triggered by Russia's invasion of Ukraine, and compounded by the Middle East war, left European manufacturers with far higher costs than their rivals.
Sir Jim said the plants in Hull, East Yorkshire, which support nearly 4,000 jobs and produce chemicals used in pharmaceuticals, clothing, cosmetics, and military explosives, were to be mothballed as European gas prices hit 12 times the level of those in the US.
Two of the plants have ceased production, and the third is due to come off line in a few days, Ineos said.
Sir Jim said: “I’m sure people will find it hard to believe that we are being forced to mothball some of the most efficient plants in Europe but with gas prices now 12 times the level in the US and eight times that of China, we just cannot compete.
“Not only is the ridiculously high gas price destroying our manufacturing base and the jobs of hard-working people on Humberside, it is also massively increasing the environmental burden with replacement products supplied from the USA at double the carbon emissions and from China at eight times the emission level.”
He added: “The European regulators need to wake up to the fact that the combination of high energy costs and the additional burden of unsustainable carbon taxes are destroying our European manufacturing base. Ironically this will result in higher CO2 emissions from less efficient Chinese and US production.
“The net result of these current policies is to encourage coal-based production in China and the wholesale export of jobs to both China and the USA.”
Ineos, a global petrochemicals manufacturer, operates 148 sites across 26 countries, including seven in the UK.
It has called for action to bring down gas prices and has also urged the UK and Europe to put in tariff protections against Chinese products.
It announced it was cutting a fifth of jobs at one of its Hull plants last year, blaming high energy costs and “carbon-heavy” imports from China, which it said were flooding the market after being blocked from entering the US due to tariffs.
Sir Jim’s latest comments come just days after he accused the government of driving away the UK’s highest earners and claimed that a combination of high taxes and high immigration was forcing the UK into decline.
He also said that the failure to invest in North Sea oil and gas is “insanity” and that gas storage was so low that the UK could “run out of gas” if there was a cold snap this winter. The government said it is “confident” in the robustness of its gas supply.
The businessman, who resides in Morocco, attracted criticism earlier this year after he stated that the UK had been “colonised by immigrants”.
A government spokesperson said: “While this is a commercial decision from Ineos, we know this will be a concerning time for workers in Saltend and their families. We’ve taken bold action to support our chemicals industry including £350 million for strategically important chemicals producers, which will be available on a co-investment basis.
“We’ve also put trade measures in place on foreign chemicals imports and are tackling high electricity costs via our Supercharger and British Industrial Competitiveness Scheme to keep our chemicals sector competitive.”
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