FOOD PRICES SET TO SOAR! – Gas privateers making huge profits

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Further heavy snowfalls are forecast today, piling more pressure on Britain’s already-stretched winter resources.

Prime Minister Brown has convened the Cobra emergency committee as forecasters warned yesterday that up to 20cm of snow could settle as grit and gas suplies are critically short.

Warnings were given yesterday that food prices are set to soar as the weather hit vegetable harvesting and and the transport of fresh produce, and panic buying emptied shops in some areas.

The Met Office issued a severe weather warning for Kent, where police said the Army was on stand-by.

Heavy falls have been taking place in Sussex, with the east of England, Wales, the East Midlands, Yorkshire and Humber and north-east England facing fresh heavy falls today.

There were prospects of some respite for councils facing a grit shortage as a fleet of lorries began delivering the first supplies of 12,000 extra tonnes of de-icing salt, made available by chemicals firm Ineos.

The salt is being supplied to some of the worst-hit areas including Pembrokeshire in Wales, East Yorkshire, Fife, Gloucestershire, Bradford and Sheffield.

But the extra supply, originally earmarked for delivery to Germany for use in producing chlorine and some foodstuffs, is only enough for a few days.

Meanwhile, oil giant BP is shutting down a large gas network in the North Sea.

The Southern North Sea pipeline system brings gas ashore from a collection of fields.

The closure for maintenance will last a week and take one per cent of domestic UK supplies off-line at a time of near-record demand. BP has declined to comment.

National Grid withdrew a third Gas Balancing Alert at 6am yesterday after supplies were restored from Norway and The Netherlands, while prime minister Brown appealed for calm, claiming in his latest podcast: ‘National grid has confirmed that it expects supplies to meet demand. I can assure you: supplies are not running out.

‘We’ve got plenty of gas, of course, in our own back yard, the North Sea, and we also have access to the large reserves in Norway and Netherlands via pipelines.’

Answering calls from charities to increase winter fuel payments, Brown said that ‘there are places where payments have been triggered now on the basis of our forecast of weather for the days to come so that in these areas, I can state, that £25 will be paid.

‘These, and the winter fuel allowances, are paid automatically to all those entitled and so no one should worry about turning up their heating.’

Meanwhile, Consumer watchdog Consumer Focus has accused energy companies of profiteering by failing to pass on steep falls in world gas prices to consumers at a time when bitterly cold weather means soaring bills for tens of millions of UK customers.

Citing predictions of a 40 per cent increase to £540m profit in 2009 for British Gas’ residential business, Consumer Focus is calling for a Competition Commission investigation to address ‘anomalies’ in the energy sector.

British Gas has benefited from a 35 per cent fall in wholesale gas prices since mid-2008, but has cut prices for domestic gas customers by just ten per cent since last February.

This pattern applies to all the big suppliers, says Consumer Focus – British Gas is by no means the worst culprit, it adds.