OPEC’s 2014 announcement set into…
The world’s most oil-dependent nations…
In the past few weeks energy prices in the UK have begun to jump by more than 10%, putting pressure on many of the country’s poorest families, and forcing them to choose between food, or heating.
Ed Miliband, leader of the British Labour Party, stole headlines a few weeks ago with his promise to freeze energy bills for 20 months if he is victorious in the 2015 general elections.
Miliband’s bold statement has helped him to steal a lead in the polls, but the Conservatives responded by claiming that such interference in the market is not possible and that in order to reduce energy bills they would have to cut green taxes.
Related article: Miliband’s Energy Price Freeze Lacks Long-Term Strategy
Viktor Orban, the prime minister of Hungary, has begun taking on the energy giants and interfering in the market in order to reduce energy prices, and limit the power of the utilities. He has shown that Miliband’s promise is not too far-fetched, and even offers the Conservative Party an example of how to retake the lead the lead in the polls coming up to the elections in 2015.
Orban, fed up with the profiteering energy companies, introduced a 10% reduction in energy bills in January, with another 11.1% cut to be adopted in November. His government is also in the process of writing up a bill that would ban utility companies from paying dividends to its shareholders, as it aims to dissolve the monopolies and return the companies to the public sector where they will work on a non-profit basis.
He declared that “we must once and for all bring an end to the era where energy providers can ride roughshod over people.”
Related article: Iran's Rouhani May Be Driving Oil Markets Now
Fidesz, the anti-communist, centre-right party of Prime Minister Orban, claims that from 2002-2010 energy prices rose on 15 separate occasions. The Guardian writes that these recent policies have helped to reduce household energy bills and offer some relief to poor families that were having to spend as much as 20% of their household budget on the gas bill alone.
Whilst some have criticised the government’s strong arm approach, it has helped them to mark out a good lead in the opinion polls, with a recent poll suggesting that the governing party was 15% ahead of its nearest rival.
The UK conservative party could retake the lead coming up to the elections if it were willing to make such bold moves, rather than remain committed to their belief in market forces, which have proven themselves ineffective.
By. Joao Peixe of Oilprice.com
Joao is a writer for Oilprice.com