Britain army all set to curb the panic of buying and shortages
- Fear of buying gasoline in the U.K. since couple of weeks led to long queues outside stations, failed to satisfy everyone’s demands.
- Nearby 200 military resources set up as a part of ‘Operation Escalin’ – a strategy designed by the government to streamline fuel supply obstacles due to shortage in the number of truck drivers.
- A senior economist working at Berenberg investment bank, Kallum Pickering stated that Britain’s fuel crisis stood out to be “WARNING SIGN” for the economy’s outlook.
British soldiers commenced fuel delivery in the United Kingdom since the fear of buying gasoline is still prevalent in few major regions of the country. The British government decided a team of around 200 personnel to be a part of ‘Operation Escalin’.
This plan was specially designed by the government to relax the panic situation and continue the easy supply of fuel due to a considerable shortage of truck drivers. Monday morning pictures clearly portrayed the exhaustion among soldiers at BP refinery, The Hemel Hampstead Terminal, England.
The drivers of army tankers have been kept on standby for the past 7-8 days and the Reserve Tankers Fleet of the government was organized on Tuesday for gasoline delivery. The fear of purchasing gasoline in the United Kingdom has lead to long queues outside the stations – which fulfilled the demands of few customers and kept other tanks dry.
Though the situation was under control in most regions, it was still a major problem in some parts of England and London’s southeast.
The United Kingdom reported the shortage of nearly 1,00,000 truck drivers, which ultimately disturbed the delivery of essential goods, food, and also fuel. Some of the key factors that contribute to this crisis are BREXIT, the COVID-19 pandemic, and regulatory changes. Also, using the army for this purpose, the government has taken major steps like suspension of competition laws for the fuel market and giving more than thousands of temporary VISAS to the drivers in order to streamline logistical challenges in the said industry.
What is the ‘Warning sign’ for the economy?
A senior and professional economist working at Berenberg investment bank, Kallum Pickering, declared the fuel crisis a “warning sign” for its economic outlook. The economist, on Monday, says that the ongoing crisis highlights miserable status and also the potential for even severe outcomes in the near future.
Pickering also added that despite Major European and United States economies witnessed a shortage of drivers, structural shortages; ultimately triggered fear of buying to be a U.K. issue.
Kallum Pickering says, “it desperately questions why the U.K. seems to be getting hit harder than other economies.” According to him, the panic and hysteria in the U.K. to some extent reflects low confidence by the general public in the government’s ability to tackle and handle the economy and also mend issues when they come up.
Pickering also noted that fear of buying could turn out to be a highlighting feature of the U.K’s economy – and described as uncomforting.
Berenberg says, despite the issues in short-term supply, the U.K. still stands on a solid recovery trajectory for some time. As expected by the investment bank, the country’s GDP is anticipated to grow by 6.9% this year but has worsened its outlook in 2022 by 0.8% (5% from 5.8%).
In the meantime, U.K. inflation is expected to reach slightly higher every year and persist for more than previous years as expected by Berenberg. The investment bank also expects Britain to witness a quarterly inflation amplification of 4% in the fourth quarter of 2021.
Pickering also said that lowering inflation pressures will transform to the Bank of England raising interest rates earlier than the previous time.
He also stated, “We now foresee the Bill of Exchange to raise the bank rate to 0.25% in May next year instead of 2022 August.” “Following 2nd 25 basis points rise in August (v/s November previously), we now look for the Bill of Exchange to begin a reactive unwind of its balance sheet after 2022 November Monetary Policy Report.”