Fitts Quoted on Rising European Energy Costs
Sarah said, “Energy supply and pricing has always been a risk for companies that are heavy energy and resource consumers, such as some manufacturers, but it has just become more volatile as a result of Russia’s actions.”
She added, “The likelihood that energy prices in Europe would substantially increase by autumn has been discussed since before March 2022, so the risk of significant energy price hikes has been foreseeable for at least six months.”
Sarah explained that because the shortage was considered foreseeable, companies may not be able to invoke contractual force majeure provisions or business interruption insurance policies.
“The precise drafting of the provisions and the facts of the situation will determine whether coverage is actually available,” she said.
Read the full article here.