National Grid has issued a warning that the UK will not have enough gas to meet demand on Thursday, as temperatures plummeted and imports were hit by outages.
It is thought unlikely that the situation will affect supply to households, but if enough extra gas supplies by pipeline or ship are not forthcoming, it could affect industrial users.
Within-day wholesale gas prices soared 74% to 200p per therm after the formal deficit warning, which acts as a call to suppliers to bring forward more gas on Thursday. Prices have since fallen back to 170p.
National Grid’s forecast for the day shows a shortfall across the day of 49.5m cubic metres below the country’s projected need of 395.7mcm. National Grid’s warning aims to fill that gap.
Widespread snow and temperatures of -7.8C due to the “Beast from the East” and Storm Emma have prompted consumers to fire up their heating. Public health authorities recommend an indoor temperature of 18C.
As a result gas demand is at a five-year high, according to market watchers Platts.
The situation has been compounded by several outages to supply, including problems with a pipeline to the Netherlands, reductions in gas flows from Norway and technical issues at facilities in the UK, including the North Morecambe Barrow terminal.
The jump in gas prices is much higher than the one in December after a major North Sea pipeline was closed for repairs.
The crunch is also the UK’s first major energy security test since the country’s biggest gas storage facility was closed by Centrica last year. The Rough site in the North Sea had accounted for 70% of the UK’s gas storage.