Energy bills could be pushed even higher if the UK experiences a long or particularly cold winter, the owner of British Gas has said.
Natural gas prices are already at a record high with a more than 50% increase in energy costs over the last six months, which has led to gas prices reaching new heights amid supply issues and increased inflation, Ofgem has said.
Cassim Mangerah, who runs energy trading at British Gas owner Centrica, said restrictions on the amount of natural gas available globally could have significant implications for UK consumers during a sustained winter.
“We haven’t seen a price situation like this before. If you can’t attract supply the only alternative is to cut demand to balance the market,” Mr Mangerah told the Financial Times.
“If we do see a supply crunch this winter the other way to balance the market is through economic activity.
“If prices are really high then some gas-dependent businesses in the UK and Europe may simply decide not to produce,” he added.
British energy companies raising prices
It comes after more than two million households saw their British Gas energy bills increase by £97 per year in April.
The price hike came two weeks after industry regulator Ofgem announced it would increase the energy price cap by £96.
Following that, E.On and Scottish Power told customers standard tariffs will jump by around £139 a year, the maximum allowed by regulator Ofgem from October 1.
Ofgem reviews the price cap once every six months, and changes it based on the cost that suppliers have to pay for their energy, cost of policies and operating costs, among other things.
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