Britain’s gas security needs reinforcement. Last-minute deals with Belgium are not a proper fix
Real-world example for IB, A-Level, AP and IGCSE Economics essays: Supply shocks, Balance of payments, Supply, demand and prices
What happened
The article notes that even after the Jackdaw gas field was approved, the UK still imports almost 60% of its gas, so its supply must come from abroad and its energy security and resilience remain a concern.
The economics
Heavy reliance on imported gas makes domestic supply sensitive to foreign sources; a disruption or price spike abroad acts as a supply shock that raises energy costs and affects output and inflation. Large energy imports also show up in the trade balance, putting pressure on the current account.
Figures to quote
- 60%
Evaluation
Yet import dependence is not automatically fragility: diverse sources, long-term contracts and storage can spread risk, while last-minute deals ease a short-term gap but cannot replace building long-term supply capacity.
Practice question
Using the example of the UK importing almost 60% of its gas, analyse how energy import dependence affects an economy's exposure to supply shocks and its balance of payments.
Where it fits in the syllabus
- Supply shocks: A sudden change in supply, such as energy, food or supply-chain disruption, that moves prices and output.
- Balance of payments: A record of a country's transactions with the rest of the world, including the trade balance and capital flows.
- Supply, demand and prices: How a change in demand or supply in one market moves its equilibrium price and quantity.
- IB Economics: Demand, Supply and Elasticity, Aggregate Demand and Supply, Exchange Rates and Balance of Payments
- A-Level Economics: Supply and Demand, Aggregate Demand and Supply, International Economics
- AP Macroeconomics: National Income and Price Determination, Open Economy: International Trade and Finance
- AP Microeconomics: Supply, Demand and Market Equilibrium
- IGCSE Economics: Demand and Supply, International Trade and Globalisation