UK Gas Prices Soar to Highest Levels Since 2022 Amid Thin Reserves

Britain's gas prices have soared to their highest levels since 2022 and more than doubled since the start of this year, putting households at risk of another energy shock that could fuel inflation. The UK relies heavily on gas, but it stores little, leaving it dependent on seaborne liquefied natural gas when demand surges or renewable generation falters.

The country's gas storage capacity is equivalent to just 12 days of average winter demand, compared with three to four months in Germany and France. The thin buffer could shrink further if the government decides not to support Rough, the country's largest gas storage site.

UK prime minister Andy Burnham faces pressure to soften the blow, as bills are expected to rise further in October and January. The Treasury will scrap the 5% value-added tax on energy bills from October, but this benefit is expected to be largely wiped out by a 4% increase in the price cap.