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Gas prices surged to a three-year high on Wednesday as Britain's reserves sank to the lowest level in Europe, raising fears of further pressure on energy bills this winter.
European natural gas reached €75 (£64.38) per megawatt hour, a peak not seen since January 2023.
The price surge comes as renewed tensions between the United States and Iran threaten to disrupt supplies of liquefied natural gas (LNG) from the Gulf, leaving Britain particularly exposed to further price rises.
The UK's gas storage facilities are currently just 31 per cent full, with around three terawatt hours of gas stored, according to figures from the European Network of Transmission System Operators for Gas.
Germany, by comparison, has around 131 gigawatt hours (GWh) in storage, more than 40 times the amount held by Britain. Despite this, Germany's own storage levels are also causing concern.
Across Europe, gas storage facilities were 63 per cent full by the end of August.
That is well below the 80 per cent typically seen at this time of year, leaving Europe's gas reserves at one of their lowest levels on record heading into autumn.
Analysts have warned that prices could rise further as countries rush to refill their storage facilities before winter.
Montel Analytics predicts gas prices could climb by as much as 19 per cent over the colder months.
David Lewis, of energy consultancy Wood Mackenzie, said a mild winter represented the continent's best hope. "Low storage levels and continued tightness in the global LNG market leave Europe with little buffer against further supply disruptions or demand spikes," he said.
"Only under a mild winter scenario do we see scope for prices to fall from current levels. In almost all other scenarios, we would expect higher prices and increased volatility."
Rising gas prices are already feeding through to household bills. Ofgem announced last week that typical annual gas and electricity costs will increase by £60 from October, with a further rise anticipated in January.
The regulator pointed to climbing wholesale gas prices as the driving force.
Natasha Fielding, an analyst at energy consultancy Argus Media, warned that the worst may be yet to come. "Europe is on course to have its most depleted start-of-winter reserves in 15 years," she said.
"Low storage increases the risk of a really big winter price spike, if Europe gets sustained cold weather or faces other unplanned supply disruptions."
Ms Fielding's concerns were echoed by Mr Lewis, who said virtually every scenario beyond a warm winter pointed to higher costs and greater market turbulence.
Britain's sole major gas storage facility, the Centrica-owned Rough field in the North Sea, is now almost empty.
A Centrica spokesman confirmed the dire state of the site and urged Energy Secretary Miatta Fahnbulleh to act swiftly on its future.
"Without a decision, Rough will be almost empty by winter and will close early next year," the spokesman said.
"The country will lose vital protection against global energy shocks forever."
The UK has historically depended on North Sea production rather than storage to see it through winter. That reliance has left the country with far less capacity to stockpile gas than its European neighbours.
With Rough facing permanent closure, Britain would be left almost entirely dependent on LNG purchased on volatile global markets.
The decline in North Sea gas output has been driven by Ed Miliband's ban on new exploration and Labour's decision to extend the windfall tax on producers. These policy choices have left Britain increasingly reliant on imported LNG rather than domestic supply.
Jean-Paul Harreman, director of Montel, described the continent's failure to replenish stocks as "remarkable after a long hot sunny summer when Europe burned far less gas than normal".
Many governments had gambled on the Gulf crisis easing, hoping that falling prices would make it cheaper to refill storage later.
That bet has not paid off. Mr Harreman warned that the delay had left reserves below mandatory EU targets.
"This has left storage below the EU's required levels, with member states on track to miss the winter storage targets. Consumers may pay the price."
