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Energy bills for households and businesses are facing upwards pressure from a surge in wholesale natural gas costs, according to market experts.
Both day-ahead and month-ahead contracts rose further on Monday as high demand and supply disruption in the storm-hit United States take their toll on prices across Europe, crucial not just for gas supply but electricity generation.
In the UK, the February delivery figure was up more than 45% over the month to date at one stage on Monday.
Some of the price pressures are weather related, while others are structural.
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The big freeze in the US has complicated the market as supplies of liquified natural gas (LNG) are delayed and some diverted as 37 states – covering half the country’s population – shiver under temperatures below -20C and a deep blanket of snow.
The weather-related disruption is predicted to last well into next week.
Europe has seen a drop in deliveries in recent weeks, the peak winter, which has exacerbated pressure on weak stocks.
Gas Infrastructure Europe data showed that EU gas storage sites were last at 45.6% of capacity, 15 percentage points below the five-year average.
It has forced up pipeline costs in the process, with UK day-ahead wholesale costs at an 11-month high.
LNG prices had been low and supplies plentiful for much of last year, thanks to weak demand in Asia and a glut of gas despite steep curbs on Russian flows because of its war in Ukraine.
Director of Europe Gas & LNG at the industry data specialists Wood Mackenzie, Tom Marsec-Manser, told Sky News: “Concerns have been rising that by the end of March…
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