We need more than price controls

A hasty, provisional thermoeconomic response to the unfolding hydrocarbons crisis

Isabella Weber and Gregor Semieniuk, in a recent essay in the New Statesman, deserve credit for clearly identifying how upstream shocks in hydrocarbons and associated chemical inputs cascade through the wider economy, generating what they call “seller’s inflation.” Their focus on market power, bottlenecks and distributional conflict is a welcome corrective to simplistic accounts that treat inflation as merely a matter of excessive demand or wage pressure. In both Weber’s broader work and this recent New Statesman intervention, the point is that concentrated firms positioned at key upstream nodes can use cost shocks and bottlenecks as coordinating devices for price hikes, transmitting inflation through the system with substantial effects on real incomes and social stability. That diagnosis is important, and substantially right.

The problem lies not so much in the diagnosis as in the horizon of the remedy. Weber and Semieniuk propose measures such as releasing reserves, capping margins and coordinating multilateral wholesale price caps in order to contain the distributive fallout from energy and commodity shocks. These are politically humane proposals. They are motivated by a serious concern to protect households and productive firms from predatory escalation, and they stand well above the familiar orthodoxy that answers every inflationary episode with interest-rate punishment. But they remain lodged within a social-democratic politics of capitalist management: the aim is to stabilise the existing system, to help it limp through crisis, rather than to use crisis as the lever for structural transformation. In that sense, the framework is redistributive without being reconstructive. It addresses the price expression of scarcity without reorganising the material conditions that produce scarcity and vulnerability in the first place.

That limitation matters because the present conjuncture is not just another cyclical inflation scare. It is the expression of a deeper thermodynamic problem. From a thermoeconomics perspective, as I have argued in Thermoeconomics in a Time of Monsters, economic life is not an abstract dance of prices and preferences but a process of organising energy and material throughput. Production, circulation and everyday social reproduction all depend on access to reliable energetic flows. Hydrocarbon systems once offered dense, transportable and highly flexible energy, and modern capitalism was built around those characteristics. But this very dependence now manifests as structural exposure. The issue is not simply that oil and gas prices are volatile. It is that an entire socio-technical order remains tied to fuels whose extraction, transport and geopolitical management generate recurrent bottlenecks, conflict and rentier power. In this setting, inflation is not only a monetary or distributive event. It is a symptom of strain within the underlying energy regime.

Seen this way, seller’s inflation is real, but it is not the whole story. It names an important mechanism of shock propagation under concentrated capitalism, yet it does not by itself provide an adequate theory of energetic transition. The upstream hydrocarbon shock is not just an opportunity for powerful firms to widen margins. It is also a warning that the energetic basis of the existing system is increasingly brittle. The bottleneck is not merely market structure; it is the dependence of market structure on a fossil metabolism. If that is the case, then policies that merely dampen price spikes while preserving fossil dependence risk becoming conservative in the most literal sense: they conserve the old order at the very moment when renewal is required.

This is the core problem with reserve releases and emergency price caps as a strategic response. They may well be justified as temporary protections. Nobody should romanticise price signals while households are being smashed and firms that actually make useful things are being strangled by upstream costs. But unless such interventions are explicitly subordinated to a rapid substitution strategy, they can mute the social visibility of physical constraint. Consumers and businesses experience less pain at the meter or checkout, while the underlying decline in available cheap fossil flow remains hidden from view. The appearance of normality is politically restored even as the real energetic basis of normality erodes. In practice, that can weaken the urgency of electrification, efficiency upgrades and industrial conversion. The shock is administered rather than transcended.

That last point is crucial. In liberal and social-democratic crisis management, the state often steps in to socialise losses so that market society can keep functioning. Sometimes that is necessary; often it is preferable to the barbarism of non-intervention. But in the energy domain this logic can become a trap. Public authorities cushion hydrocarbon volatility, absorb social discontent and prevent breakdown, yet leave intact the infrastructural commitments and corporate power relations that guarantee another shock later. One gets a politics of permanent triage, which mask systemic gangrene. Each crisis is met with a new patch: release reserves, subsidise bills, cap margins, negotiate temporary relief, then wait for markets to “settle.” The result is not transition but managed stagnation, with the public effectively paying to defer a reckoning.

Thermoeconomics suggests a different framing. The question is not merely how to distribute the costs of an energy shock more fairly, though that obviously matters. The deeper question is how to recompose the economy around a superior energetic basis. A rational response to hydrocarbon scarcity is not to preserve hydrocarbon normality for as long as possible. It is to accelerate the migration of end uses away from combustion and toward electrified systems powered by increasingly diverse and domestically controllable sources. In households, that means electric heating, heat pumps, induction cooking and improved building efficiency. In transport, it means EVs, electrified freight where possible, and strong public transit. In industry, it means electrified process heat where technically feasible, alongside grid upgrades, storage and strategic industrial planning. The point is to reduce exposure to fossil fuel bottlenecks, not merely to make those bottlenecks more bearable.

This is where the subsidy question becomes politically sharp. Every dollar spent propping up fossil consumption without reducing fossil dependence is, in strategic terms, a dollar spent preserving the problem. Fossil fuel subsidies and crisis relief mechanisms are often defended in the name of affordability, but affordability severed from transition quickly becomes a defence of inertia. A thermoeconomic approach would redirect public spending toward shortening the distance between the old energy regime and the new one. Instead of using fiscal capacity primarily to hold down the social costs of hydrocarbons, governments should use it to finance the capital stock turnover that makes hydrocarbons progressively less central. That means public support for electrification infrastructure, domestic manufacturing capability, grid resilience, storage, charging networks and the reorganisation of industrial supply chains around non-combustion energy forms. The task is not to make fossil dependence cheaper. It is to decentre it.

There is also a structural power issue here that Weber’s framework only partly captures. Seller’s inflation usefully highlights the role of concentrated firms in exploiting emergencies. But the deeper asymmetry is not only firm-level market power; it is the systemic leverage conferred by control over energy-dense upstream inputs in a fossil economy. Hydrocarbon systems generate rents because they occupy commanding heights in the material reproduction of society. Whoever controls those chokepoints enjoys not just pricing power but political power. Reserve releases and margin caps may discipline the expression of that power at the edges, but they do not dissolve its foundations. Electrification, by contrast, potentially changes the geometry of power itself. It can reduce dependence on imported fuels, weaken the geopolitical centrality of oil transit corridors, diversify generation sources and shift more energy use into systems that can be provisioned domestically and managed through public infrastructure. In other words, transition is not simply an environmental preference. It is a reorganisation of material sovereignty.

That is why the present moment should be read as one of accelerated renewal rather than merely disciplined restraint. We should not treat the crisis mainly as a problem of inflation governance, when it is equally and more fundamentally a problem of civilisational energy transition. To stabilise prices without transforming energy systems is to confuse the symptom for the disease. One can suppress the immediate distributive violence of the shock and still leave intact the hydrocarbon dependency that makes the next shock all but inevitable.

A more adequate policy program would therefore braid protection and transformation together. Yes, households and productive firms need shielding from predatory price escalation. To be sure, emergency measures may be necessary to prevent distributive collapse. But those protections should be temporary, conditional and nested inside a larger strategy of forced transition. Any reserve release should be paired with accelerated investment in electrified alternatives. Margin caps should sit alongside public investment mandates and industrial conversion programs. Subsidies for bills should be tied, where practical, to household retrofits, appliance replacement, EV uptake, public transport expansion or industrial efficiency upgrades. The principle should be simple: crisis relief must reduce future exposure, not simply underwrite present dependence.

Weber et al are right about the mechanism, but too narrow about the horizon. The account of seller’s inflation is a valuable contribution to understanding how concentrated capital transmits and amplifies upstream energy shocks. The proposed remedies are humane and, in the narrow sense, sensible. But they remain politically and thermodynamically inadequate to the scale of the challenge. They belong to a tradition that seeks to manage capitalism’s crises more fairly, not to reconstruct the energetic basis of social reproduction. Today, I suggest, that is not enough. We are not merely trying to get through another price spike. We are living through the exhaustion of a hydrocarbon-centred regime and the opening of a struggle over what comes next. In that setting, the priority should not be to subsidise fossil normality, even in softened form. It should be to use every available lever to hasten electrification, reduce hydrocarbon exposure and build a more resilient energetic order.

Politically humane crisis management is welcome, arguably necessary to alleviate short-term crises, but without thermoeconomic renewal it risks becoming a subsidy for energetic renewal inertia.