Europe’s energy bill nears €800bn after Putin cuts off gas – live updates

Putin gas supplies Europe energy crisis Bruegel - Getty Images

Putin gas supplies Europe energy crisis Bruegel – Getty Images

European countries have forked out nearly €800bn (£708bn) to protect households and businesses from soaring energy prices.

EU nations have now earmarked or spent €681bn in energy crisis spending, while Britain has allocated €103bn and Norway just over €8bn, according to analysis by the Bruegel think tank.

Germany was by far the biggest spender, splashing out nearly €270bn since September 2021.

The figures mark a sharp increase since the last report three months ago as countries face the impact through winter of Russia cutting off gas supplies to Europe last year.

Bruegel said governments had so far focused most of the support on non-targeted measures such as VAT cuts on petrol or retail power price caps.

But it warned support should now be targeted by income levels as countries start running out of fiscal space to maintain such broad funding.

Read the latest updates below.

08:12 AM

America is overtaking us on green fuel, warns British Airways chief

British Airways IAG green fuel - Steve Parsons/PA Wire

British Airways IAG green fuel – Steve Parsons/PA Wire

ICYMI – Rishi Sunak is failing to deliver one of the UK’s flagship green policies, the chief executive of British Airways’ parent company has said.

Oliver Gill has the story:

In a rare intervention, Luis Gallego, chief executive of International Airlines Group (IAG), says Britain has fallen behind the US in the production of green aviation fuels because of Government inaction.

Writing in the Telegraph, Mr Gallego said “time is running out” for the UK as America establishes a lead by virtue of billions of dollars of White House subsidies.

“If there isn’t enough of these alternative fuels to go around, which at the moment there isn’t, UK aviation’s net zero ambition is put at risk,” he said.

“Jet Zero” was one of 10 commitments made in November 2020 under Boris Johnson’s £12bn programme to deliver a “green industrial revolution”. The Government’s 10-point plan said: “Moving to sustainable fuels is one of the key steps to success that we can unlock.”

A strategy for reaching net zero aviation by 2050 was subsequently published last summer.

Read the full story here

08:01 AM

FTSE 100 opens higher

The FTSE 100 has started the day on the front foot as markets look ahead to the latest inflation data this week.

The blue-chip index ticked 0.2pc higher at the open to 7,895 points.

07:47 AM

NatWest boss in line for £1m bonus

NatWest Alison Rose bonus - JULIAN SIMMONDS

NatWest Alison Rose bonus – JULIAN SIMMONDS

NatWest is reportedly poised to give its chief executive an annual bonus of almost £1m – the first since its bailout in 2008.

Alison Rose, 53, is set to receive a payout of as much as £953,700, divided between cash and shares, the Times reports.

That would be worth 85pc of her annual salary and comes after the high street bank cashed in on rising interest rates last year.

NatWest last year said it planned to start paying its management cash bonuses, warning that compensation was falling too far behind that of rivals.

07:38 AM

UK companies to pay more and hire less

UK companies plan to cut hiring as the economic outlook darkens, but a shortage of workers means they’ll pay record salaries for the staff they need.

A report from the Chartered Institute of Personnel and Development found the typical UK employer is planning to raise pay by 5pc – the highest since records began in 2012.

The industry group said more than half of firms intend to recover their costs by raising prices rather than finding savings, a move that threatens to push inflation even higher.

The CIPD said: “The opposite was true 12 months ago, suggest that the tight labour market will increasingly feed through into price rises for organisations’ goods and services.”

The UK narrowly avoided a recession at the end of 2022 as the economy flatlined, but many economists expect a slump this year. Data this week is expected to show that inflation is still in double digits.

07:30 AM

Good morning

European nations have splashed out nearly €800bn on energy support measures as the continent continues to reel from Putin’s gas cuts.

Germany is by far the biggest spender, forking out nearly €270bn since September 2021. EU nations have spent €681bn in total, while Britain has allocated €103bn, according to think tank Bruegel.

But the think tank warned that most of the support so far had been non-targeted and urged governments to change their approach.

Giovanni Sgaravatti at Bruegel said: “Instead of price-suppressing measures that are de facto fossil fuels subsidies, governments should now foster more income-support policies targeted towards the lowest two quintiles of the income distribution and towards strategic sectors of the economy.”

5 things to start your day

1) America is overtaking us on green fuel, warns British Airways chief – Luis Gallego says goal to decarbonise aviation is ‘at risk’ unless more is done to boost industry

2) Buy-to-let bust sees 66 rental homes disappear each day – Soaring mortgage rates and tax rises push landlords out of the property market

3) AI song generators threaten ‘lasting harm’ to artists, warns Universal – World’s biggest record label warns against relaxing copyright laws to fuel AI creation

4) How Britain’s broken housing market is crushing growth – A dysfunctional property market is excacerbating Britain’s productivity crisis

5) A million more people facing paying tax on savings under Hunt’s stealth raid – Nest eggs under threat thanks to interest rate rises and frozen tax thresholds

What happened overnight

Asian shares slid and the dollar rose on Monday as investors hunkered down for US inflation data that could jolt the outlook for interest rates globally, while accelerating or reversing the recent spike in bond yields.

MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 0.7pc, after losing 2.2pc last week.

Japan’s Nikkei fell 1pc and South Korea 0.7pc. Meanwhile, Chinese blue chips inched up 0.6pc aided by strong data on bank lending.

Hong Kong stocks tumbled at the start of trade, with the Hang Seng Index sinking 1.32pc.

The Shanghai Composite Index eased 0.11pc, while the Shenzhen Composite Index on China’s second exchange dipped 0.05pc.

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