KUALA LUMPUR (Sept 5): The world’s second-largest steelmaker, ArcelorMittal, has announced a plant closure in Europe due to soaring gas and energy prices.

Citing a statement from the company, energy portal Oilprice.com last Friday (Sept 2) reported that ArcelorMittal will shut one of its two blast furnaces at its steelworks site in Bremen, Germany, from the end of September until further notice, due to the “exorbitant rise in energy prices”.

The high energy prices are undermining the competitiveness of steel production and the company is taking this step in Germany because it cannot operate all plants economically, ArcelorMittal said.

The steel giant also cited weak market demand, a negative economic outlook, and persistently high CO2 costs in steel production as reasons for its decision.

ArcelorMittal Germany’s chief executive officer Reiner Blaschek said the high gas and electricity costs are putting a heavy strain on competitiveness.

“On top of that, from October onwards, there will be the German government's planned gas levy, which will further burden us,” said Blaschek.

Blaschek also called on politicians to urgently take action to “get energy prices under control immediately”.