European gas prices jump 150% amid low British stocks and supply disruptions
Key Facts
European gas prices rose 150% ahead of the seasonal drop in temperatures, according to The National newspaper, as Britain faces pressure on energy supplies and costs. The newspaper said Britain's underground gas storage sites were only 48% full at the start of October, as winter approached. Across the European Union, underground storage was 72% full on 1 October 2026, according to the European Network of Transmission System Operators for Gas. These levels follow a winter in which stored gas covered about 26% of EU gas consumption during the 2025/26 season. Storage had supplied about 30% of consumption during winter 2024/25, according to the network, which monitors supply preparations for the coming season.
In the liquefied natural gas market, the European Network of Transmission System Operators for Gas said disruptions to exports from the region had increased competition between European and Asian buyers for available cargoes. Its winter supply outlook report said about 20% of global LNG trade passes through the Strait of Hormuz. Supply disruptions include interrupted shipping through the strait and restrictions on LNG exports from Qatar and the United Arab Emirates, according to the report. Qatar accounted for about 8% of EU LNG imports in 2025, making its exports one of the supply sources the bloc relied on ahead of the current winter. Describing the disruption's effect on buying activity, the network said it had "intensified competition for available cargoes between Europe and Asia".
In Britain, Centrica Chief Executive Chris O'Shea said the Rough gas storage facility was "almost empty", attributing its condition to market conditions that make operating it financially unviable. O'Shea raised the possibility of the company investing £2 billion in the facility, provided an appropriate regulatory framework was in place for the investment. He linked Rough's future operation to the government including it in a regulatory support model, as the country prepares to get through winter with limited stocks. He warned that without this support, the facility would remain empty through winter, in line with the company's stated position on its operating viability. He added that Rough could close by spring if the government did not include it in the model, raising the prospect of closure as part of his warning about the facility's future.
On consumer costs, Britain's energy regulator Ofgem announced a 4% increase in energy prices for a typical household using gas and electricity and paying by direct debit. The increase applies from 1 October to 31 December 2026, according to the regulator's energy price cap announcement for that period. Ofgem attributed the rise in bills to higher wholesale gas prices, identifying the ongoing conflict in the Middle East as the cause of the increase. The regulator said pressure on wholesale prices was linked to the "ongoing conflict in the Middle East", explaining the adjustment that took effect in October. Households covered by this model therefore face a current increase in gas and electricity costs through the end of December, under the regulator's decision.
For the following period, Cornwall Insight forecast that the annual bill cap for a typical household using gas and electricity would rise to £1,999 in January 2027. The company estimated an expected increase of 16% from October, as part of its forecast for the annual bill level at the start of the next period. Its estimate relates to a household using both forms of energy, with the bill cap expressed on an annual basis, according to its statement on the January outlook. In its assessment of continuing supply disruptions, the company said resolving them could take months even if the conflict ended immediately. It described the time needed to restore regular supplies as potentially taking "months to rectify", linking its estimate to the ongoing disruption to gas flows.
As winter progresses, the European Network of Transmission System Operators for Gas warned that EU storage levels could fall to "well below 30%" by the end of the season. The network linked this scenario to continued limited LNG availability, as part of its assessment of supply risks during the season. The warning remains conditional on this supply constraint persisting, according to the network's winter outlook for storage levels at the end of the season. In Britain, Ofgem set the next energy price cap announcement for by 25 November 2026, the next regulatory step in setting prices. That date falls before January 2027, the month covered by Cornwall Insight's bill forecasts, and after the current increase took effect in October.