As a result of the increased demand because of recent cold weather and rocketing prices in the Asian LNG market, today British gas hit a low of 1bcm of storage remaining resulting in a hike in British wholesale gas prices to a two year high.
The world has been hit by rocketing gas prices─Japan is paying five times the current spot price for LNG whilst Spain is paying more than double. As a result of LNG cargoes being diverted to the Far East, the EU and UK are now solely reliant on pipeline gas and storage supplies for their respective gas needs.
John Wood, CEO of InfraStrata plc comments:
“The current state of affairs in the gas market only goes to highlight how imperative it is to build up gas storage in the UK and island of Ireland to protect against volatility in the global gas market. Whilst we are solely reliant on pipeline gas and storage supplies, our security of supply is under threat. With the storage capacity that the Islandmagee gas storage project would introduce, we would be provided with an increased buffer that not only absorbs the impact but protects against it. Events like this are only going to increase in frequency as extreme weather events become more likely with climate change. The Islandmagee gas storage project is critical to the future energy security that will enable us to heat our homes and power our grid.”
