High Street profits hit by petrol blockades

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The Independent Online

High street stores complained yesterday that the fuel shortages earlier this month dented their profits because shoppers stayed at home or stocked up on food supplies.

High street stores complained yesterday that the fuel shortages earlier this month dented their profits because shoppers stayed at home or stocked up on food supplies.

The retailers, including the confectionery chain Thorntons and the fashion chain New Look, said the worst effects were felt at the peak of the crisis in the second week of September, when the fuel blockades paralysed the country.

Last night, business leaders said those complaints were a foretaste of much gloomier results from across industry which would come out next month, after companies complete their accounts and wage bills for September.

Stephen Alambritis, of the Federation of Small Businesses, said: "Small and medium- sized businesses run on very tight margins and having a week's turnover decimated by up to 75 per cent may mean they can't honour their commitments, such as repaying loans and overdrafts to their banks."

That prediction was given further weight in a survey by the Greater Peterborough Chambers of Commerce, which found that 38 per cent of its members had lost sales because of the crisis. One in seven companies had temporarily stopped trading while refineries were blockaded and 6 per cent had financial problems.

The greatest damage was felt in the delivery of goods and services, with 73 per cent of businesses affected, 33 per cent reporting a drop in output and 28 per cent staff absences. Firms said meetings and sales demonstrations were cancelled, important contracts delayed and retail sales reduced by up to 40 per cent.

The clothing retailer New Look claimed the petrol crisis had cut its sales in September by £2m and reduced its gross profits by £1m. The discount chain TJ Hughes, with stores around the country, said its sales had also been "adversely affected" by fuel shortages.

The high oil price has also hit Irish Sea ferry services. From today, Sea Containers will impose a £2 "fuel surcharge" on all passengers using its SeaCat and SuperSeaCat ferry services between Belfast, Troon, Heysham, Liverpool and Dublin. Hamish Ross, the company's managing director, said his firm had tried to absorb rising fuel prices since late 1999 but could no longer afford to do so. "There have been further dramatic rises," he said.

The Confederation of British Industry and the British Chambers of Commerce are publishing the results of national surveys that are expected to underline the impact of the crisis next month. A Chambers of Commerce spokesman said: "A lot of businesses were on the verge of going on to short time, but the crisis dissipated as quickly as it flared up."

Although Tony Blair insisted at the Labour Party conference yesterday that higher fuel costs were due primarily to increases in world oil prices, the business groups' findings are likely to increase pressure on the Chancellor, Gordon Brown, to lower fuel duty.

Meanwhile, fuel protests in Spain increased yesterday, with fishermen blockading Mediterranean ports, causing a shortage of fish throughout much of the country. Barcelona ran out of fresh fish and dozens of fishermen blocked the main road from France at the border town of La Junquera to prevent French fish being imported.

Petrol station owners in Majorca also warned that fuel reserves would dry up throughout the Balearic islands today because of a week-long blockade of the regional depot in Palma.

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