Fears for gas supply in the big freeze
THE freezing weather has caused a run on British gas reserves by European buyers bolstering their own supplies.
Gas held at the UK’s biggest storage site plunged to its lowest level in six years and could run dry within weeks.
Supply concerns have already pushed up wholesale gas costs and now hoped-for household energy price cuts could be jeopardised.
The massive Rough storage field off the East Yorkshire coast was just 44 per cent full last week as gas flowed out of the UK via a pipeline to the Continent.
“In the last few days the flows to Europe have jumped and it would appear storage in the UK is being drained to fill up storage in Europe,” an industry analyst said.
The recent gas war between Russia and Ukraine created a gas shortage in Europe. Our gas exports to Europe nearly doubled during the dispute.
The conflict created a huge “gas hole” which buyers in Europe are trying to plug with UK gas. Wholesale gas costs jumped five per cent last week as the looming cold snap sparked supply concerns.
One gas trader said: “There is a concern about Rough being empty by very early March, so a colder than normal March would put severe pressure on it.” Britain only has storage for 15 days of gas. That compares to France and Germany with around 90 days of storage capacity each.
Vast North Sea reserves meant Britain did not need to store gas. But we are increasingly dependent on imports as those reserves run out, making the UK more exposed than ever to energy supply problems and price jumps on the Continent.
