Gas shortage to push up bills after 'perfect storm' of energy problems
Households and motorists have been warned to expect sharp rises in gas bills and petrol prices after a “perfect storm” of supply problems as the winter freeze begins.
The shutdown of the North Sea’s most important oil and gas pipeline system on Monday was compounded by an explosion at a major processing facility in Austria, which is the main point of entry for Russian gas into Europe.
After the incidents, wholesale gas prices hit their highest level for six years, rising by more than 50pc in the space of 24 hours, raising fears that the increase will be passed on to customers.
Oil prices have climbed so steeply that motoring organisations are warning of a 3p per litre increase at the pumps by Christmas.
MPs have told energy companies that any hike in bills for consumers would be a “disgrace” because wholesale prices are agreed well in advance.
“The big energy companies buy their gas and oil about six months in advance, so there should be no need to increase bills.
“They should continue to honour their commitments to consumers. If they pass this on to their customers, it would be a disgrace.”
As well as problems affecting the Forties pipeline in Aberdeenshire and the Baumgarten facility in Austria, a series of smaller setbacks also added to the sense of crisis.
One of the largest North Sea sites is struggling to produce gas at its normal rate. The ageing Morecambe field is supplying at only around two million cubic metres (mcm) per day, less than half its usual rate of 5 mcm.
On Tuesday, BBL, the Dutch company that operates the gas pipeline between the Netherlands and the UK, had to restrict supply temporarily across the Channel because of problems with a compression station.
Meanwhile, Norway’s giant energy company Statoil said that it reduced output from its platform in Troll, Europe’s biggest offshore gas field, because of a power outage.
Norway is one of the main suppliers of gas to the UK.
The current cold snap has driven gas demand in homes and businesses to their highest forecast levels since early 2013.