The combination of overproduction crisis and soaring fuel prices is putting the German economy under such intolerable pressure that sooner or later something will have to give – maybe even the European Union itself.
Having bullied Berlin into stopping the Nord Stream 2 gas pipeline and facilitated the terrorist sabotage of most of the rest of the Nord Stream network, US imperialism has for the moment secured Germany and France as a captive market for US liquified natural gas (LNG). It is taking maximum advantage of the block on Russian gas to force EU members to pay through the nose for LNG shipped from the USA.
It costs only $60m to fill up a big tanker in the USA, the contents of which can be sold in Europe for as much as $275m, thanks to the gap which yawns between the US and the European market prices. The USA has Germany on the rack and keeps on turning the screw, unperturbed by the longer-term political consequences of treating an ‘ally’ in this way.
The stability of the EU is largely founded on Germany’s strong industrial base. It is that strength that is now being fatally undermined as industry is starved of affordable energy, resulting in many factory closures or relocation to the USA.
Fearful of losing market share to its own European rivals, Germany has been trying to bolster industry and soften the blow to consumers by a generous subsidy package. German chancellor Olaf Scholz recently announced a €200bn subsidy measure to cushion German households and businesses from soaring energy prices. And this is in addition to a subsidy of over €100bn already granted over the last year, plus €85bn specifically to bail out energy companies.