Energy Hyperinflation

Posted By Darren Winters on Sep 1, 2022


Energy Hyperinflation

The worst policy-driven energy hyperinflation could unfold as the northern hemisphere tilts towards winter.

Collapsing living standards can be attributed to energy hyperinflation. 

Food bank demands are already spiking in advanced economies.

In Northern Texas, the hungry people and unemployed lines outside the food banks are worse than a few years ago during the lockdowns.   

Trisha Cunningham, CEO of NTFB, told CBS News that demand for her food bank “is worse than a couple of years agowe are serving now at higher levels than we even did at the peak of the pandemic.”

The world’s richest consumers are finding it challenging to buy groceries.

The green policy, which advocates shelving fossil fuel infrastructure projects, is attributed to US Energy hyperinflation

Energy Hyperinflation

For example, Keystone XL was halted by owner TC Energy after US President Joe Biden, this year, revoked a key permit needed for a stretch of the 1,200-mile project.

Dakota Access and Enbridge Line 3, face continued opposition from environmental groups.

In Europe, energy hyperinflation is a potential systemic crisis that could ignite a legitimation crisis.

Europe’s energy hyperinflation could lead to hardship not seen in over four decades. 

The policy decision to aid and abet the ongoing Russian-Ukraine war with billions of dollars of arms sales to Ukraine has prolonged the war and created the worst refugee crisis in Europe since WW2. 

Moreover, Russian sanctions preventing European countries from sourcing energy supplies directly from Russia have made a few slippery middlemen millionaires overnight as they front-run Russian oil, at a markup, into Europe.

China is quietly reselling its excess Russian LNG to Europe.

So the policy-driven energy hyperinflation benefits the few to the detriment of the many.

Over the past week, shocked Europeans, mainly in the UK and Ireland, posted viral photos of shockingly high energy bills amid the ongoing and worsening energy crisis.

The owner of a small coffee shop in the center of Athlone was shocked when she opened her electricity bill this week and realized she had been charged almost €10,000 for just over two months of energy usage.

The coffee shop owner can no longer continue running her business which she owned for 16 years. A raft of British pubs is also experiencing a similar predicament.

For industry, energy hyperinflation could cause continuing supply chain disruptions as a string of operations close down as they are no longer economically viable in this new high energy cost environment.

So energy hyperinflation has nothing to do with central bank monetary policy. Further tightening will collapse the supply chains, add to inflation, and drive households into third-world poverty. Think about it. If households are cutting back on food because of energy hyperinflation, then Fed rate hikes will only add to the burden by raising mortgage costs. 

Further Fed hikes combined with energy hyperinflation are likely to cause a historic depression and civil unrest. 

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