Russia-Ukraine gas row could force up UK gas prices

Tue Jan 6, 2009 2:06pm GMT
 
Email | Print | | Single Page
[-] Text [+]

* Russia-Ukraine gas row could increase UK wholesale prices

* British govt does not expect dispute to affect supplies

By Philip Waller

LONDON, Jan 6 (Reuters) - Failure to resolve a gas row between Russia and Ukraine could drive up gas prices, Britain's Centrica (CNA.L) warned on Tuesday, although the British government said it did not expect the dispute to affect UK supplies.

A continuation of the price dispute between Moscow and Kiev could increase wholesale prices in the UK and force British suppliers to import more gas from continental Europe, a spokesman for Centrica, which owns retailer British Gas, said.

Europe receives about one fifth of its gas from pipelines through Ukraine and some southern and eastern European nations have seen flows fall or stop following Russia's decision on Jan. 1 to cut supplies to the former Soviet republic.

"Spot prices in continental Europe are higher than they are in the UK, but if the situation (between Russia and Ukraine) becomes protracted and there are continued shortfalls in gas supplies, then the situation in the UK is likely to change," the spokesman said. "Spot prices here will rise and we'll need to import gas from Europe."

The UK has fairly good gas reserves at the moment, although it has only enough capacity to store about two weeks' worth of gas, while France has capacity to store about 80 days' worth of gas and Germany has enough for 90 days.

The UK's Department for Energy & Climate Change (DECC) urged Moscow and Kiev to resolve their differences.  Continued...

 

Market Update

  • UKUK
  • USUS
  • Europe
  • Asia
  • UK Most Actives

Most Popular Business News on Reuters UK

  • Articles
  • Videos