Energy price update: Monday 9 March 2026

 

 

 

Why Gas Is More Volatile Than Electricity in the UK

UK gas prices tend to spike more than in many European countries because of the structure of the UK energy system. Several key factors make the UK particularly sensitive to movements in global gas markets

1. Limited Gas Storage

• The UK has significantly less gas storage capacity than countries such as Germany or France.
• The UK can store only a few days to weeks of winter demand.
• Some European countries can store several months of supply.
• The UK’s largest storage facility, Rough, was closed in 2017.
• Because storage capacity is limited, the UK must purchase gas more frequently at current market prices. When global prices spike, those increases are felt almost immediately in the UK.

2. Heavy Reliance on Gas for Heating

• Around 85% of UK homes use gas boilers for heating.
  This means:
• Winter cold spells cause sharp spikes in gas demand.
• The UK must secure large volumes of gas quickly.

3. Electricity Prices Are Linked to Gas

• Gas prices also strongly influence electricity prices.
• Many UK power stations generate electricity by burning gas, and electricity markets operate on a system where the most expensive generator needed to meet demand sets the price — which is often gas.
  As a result, when gas prices rise,
• Gas-fired power becomes more expensive,
• Electricity prices increase as well, even if a large share of power comes from renewable sources.

4. Exposure to Global LNG Markets

• The UK imports significant volumes of liquefied natural gas (LNG) and therefore competes in the global gas market.
  This means UK prices can be affected by events far outside Europe, including:
• Rising LNG demand in Asia
• Global supply disruptions
• Wars or sanctions affecting gas exports

5. Declining Domestic Production

• Gas production from the North Sea still contributes to UK supply, but output has been declining for decades.
• As domestic production falls, the UK becomes more reliant on imported gas, which is priced according to international market conditions.

Summary

UK gas prices tend to be more volatile because the country has:

• Limited gas storage capacity
• High reliance on gas for home heating
• Electricity prices linked to gas generation
• Strong exposure to global LNG markets
• Declining domestic gas production

Together, these factors mean the UK is more sensitive to sudden movements in global gas prices than many other European countries.

GAS PRICES at 1pm Monday 9th March

Wholesale gas prices are around three times those prior to the invasion of the Ukraine and the summer of 2024 & 2025. Although still a quarter of the peak after the Ukraine invasion.

Since late November 2025 the Care England/Focus Energy Gas Tender has enabled providers to secure gas supplies at a price below 3.5p (with a low standing charge), fixed until the Summer of 2029. That low price was available to all providers up to Friday the 27th February.

The main issue for gas prices today is the blockage of the “Straits of Hormuz” in the middle east. Qatar produces around 20% of the worlds Liquefied Petroleum Gas (LPG), which can’t be shipped to Europe via the Straits. Alternative routes take up to 3 times as long, with the resultant vastly increased shipping cost and time delay.

For providers with gas renewals due before the end of March 2026, we suggest that “knee jerk” reactions are avoided. Nobody can predict what will happen to the situation in the middle east. Providers have 3 options

• Compare a 2 month quote to commence the 1^st April 2026 to your current providers “deemed/out of contract rates” (these can change frequently)
• Enter a longer contract, which would be at much higher rates that recently available.
• Wait a few days up to around the 20^th March and then make a decision.

As always but more so now quotes from different sources will differ widely.

Option 1) Enables you to benefit if prices reduce in the next few weeks 2) Gives you certainty but at a much higher cost than recent rates. 3) If prices fall, you benefit, but a chance gas prices could rise further.

When shipping recommences through the Straits of Hormuz prices should fall back quickly, hence the reason for not rushing into a decision.

ELECTRICITY PRICES

Electricity prices are less volatile than gas due to the various sources that generate electricity. With electricity demand being lower than during the winter period the effect on prices has been less dramatic.

Changes imposed by the Government have made quoting electricity far more complicated with the non-commodity element of your electricity bills rising, these come into effect on the 1^st April 2026.

 

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Getting independent advice

The Care England/Focus Energy Tender has developed new ways to purchase electricity, helping to mitigate increases.

It’s now more important than ever that a providers electricity consumption is properly analysed before quotes are obtained from an informed broker that:-

• Understands the sector.
• Has the ability to quickly obtain your detailed consumption data.
• Can quote from the increased range of options available.

As with gas, if your renewal is due before the 31^st March 2026, you have the 3 options.

 

For further information or a free review of your electricity bill or contract, contact Focus Energy at:

info@focusenergyservices.co.uk