00:00Well, when people think about oil and gas prices going up, their immediate concerns are how much it's going to
00:05cost to fill up their cars and to heat their homes.
00:08But the energy spike is about much more than that.
00:11Farmers depend on fertilizer to maintain crop yields, and one of its key ingredients is ammonia from natural gas.
00:18Supply disruptions can delay planting decisions or even force a crop change with knock-on effects right through the supply
00:25chain.
00:25From farming to fashion, hydrocarbons from oil and gas are broken down to smaller molecules, which are used to make
00:33synthetic fibers like polyester, nylon and acrylic.
00:36Supply disruptions and soaring prices have knock-on effects for textile production, including factory shutdowns further along the supply chain.
00:45And think about all the tech we use daily.
00:48The extraction of copper and cobalt relies heavily on sulfuric acid recovered from sour hydrocarbons.
00:54If supplies are disrupted, so is the availability of these critical minerals, an essential part of thousands of industrial processes.
01:04Jasmine Bertels is founder and director of Money Magpie, a financial advice website.
01:10Great to see you, Jasmine.
01:11I had to fill up my car this morning with petrol.
01:13I had a bit of a shock at how much it cost, but it's not just about that, is it?
01:18This runs through fertilizer, clothing, even tech.
01:20How exposed are consumers, really?
01:25Well, we are very exposed.
01:27I mean, as you say, fertilizer prices, they're already rising, but they surged after the Iran attacks by almost a
01:33quarter.
01:34And that affects the price of food because fertilizer is used to produce food.
01:39So the knock-on effect, I don't know when we'll see it, maybe in a few weeks, a few months'
01:44time, we should see food prices go up.
01:46And of course, it's also more expensive to transport food and all goods because the price of petrol, as you've
01:53mentioned, that's going up.
01:55And then, as you say, there are all sorts of other weird and wonderful things that we didn't know were
02:01side effects or offshoots, byproducts of oil.
02:05As you mentioned, you know, in textiles, that will put the price of some textiles up, which will put the
02:10price of some fashions up.
02:12And also plastics, plastics used in all sorts of things.
02:17And if this disruption drags on, Jasper, what is the bigger picture?
02:22Are we talking slower growth, job losses or something more serious for the global economy?
02:28Well, yes, we're talking about inflation, certainly.
02:32Now, to be honest, I've been expecting inflation to go up anyway.
02:37But, I mean, you know, inflation is about the cost of living, things costing more.
02:41And we are expecting, because of the price of oil going up, that things generally will go up.
02:48So, inflation could go up.
02:49If so, then, and you've mentioned this already in your programme, we might see interest rates go up in order
02:58to try and bring down inflation.
03:00Although, you know, not sure that would actually work.
03:02As you say, it could potentially mean job losses.
03:06If everything's too expensive for companies to produce, they're going to be looking at, you know, where can they make
03:11cuts.
03:11That could be in people.
03:15It's generally a pretty tough one, as you say, for the global economy, because this is a global issue.
03:21It might seem to be two countries or three countries at war, but it affects the whole world, particularly the
03:29West,
03:30because the Strait of Hormuz is so important to us.
03:33So, it all depends on how long this lasts.
03:35It's Jasmine Bertels from Money Magpie.
03:37Thank you very much indeed.
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