German Inflation Hits 8.5 Percent, Again Driven by High Energy Prices
So far, energy providers have been bearing the brunt of the exorbitant increase in the price of natural gas. One financially troubled German energy company, Uniper, was bailed out last week by the government, which took a 30 percent stake. But starting this fall, the government will introduce an energy surcharge of several cents per kilowatt-hour on consumer energy bills that will be passed along to utilities. Officials expect the charge will translate to an annual increase of several hundred euros per household.

Germany, which still relies on Russian natural gas for about a third of its needs, has been hit especially hard by Russia’s decision to sharply reduce deliveries of the fuel. This week, Gazprom, the Russian energy giant, reduced flows through the Nord Stream 1 pipeline to Germany to 20 percent of capacity, a further restriction on already limited deliveries.

Economists have said Germany is on the edge of a recession, as business sentiment declines and officials urge citizens to cut their energy use in any way possible, even by taking cold showers.

Last week, the European Central Bank raised interest rates for the first time in more than a decade to control rising prices amid mounting concerns over an economic slowdown.