British homes and businesses face a potential gas crisis this winter after a perfect storm of shock outages sent prices surging just as demand for heat reached highs not seen in almost five years.
The shutdown of the North Sea’s most important oil and gas pipeline system has been compounded by an explosion at a major gas processing facility in Austria, creating a perfect storm of disruption to gas supply across Europe.
The Baumgarten explosion effectively obstructs the main entry point for Russian gas, which makes up a third of the continent’s overall supplies.
This hit is most painful for Italy, where market prices have already more than doubled, prompting the country to declare a state of emergency to tackle its “serious” energy supply problem.
The reverberations have been keenly felt in the UK, where gas prices have surged to more than 90p a therm from just over 57p last week.
The price for January’s gas has also climbed by almost a third, sparking concern that suppliers may need to lift energy prices.
For smaller suppliers the rocketing price could pose an existential threat if they have not been able to buy enough in advance to meet demand.
The current cold snap in the UK has driven gas demand in homes and businesses to their highest forecast levels since early 2013, according to data from Thomson Reuters.