Energy crisis: UK could run out of gas if winter is especially cold, industry boss warns

Sir Jim Ratcliffe said he expects the price of wholesale gas to remain high this winter. Credit: ITV/Peston

If the upcoming winter season is especially cold, the UK could run out of gas, the boss of an empire which includes gas, oil and refineries has said.

Chair of INEOS Sir Jim Ratcliffe spoke to ITV's Peston show as regulator Ofgem announced that a further two energy suppliers, unable to withstand soaring gas prices, had gone bust.

When asked whether the UK could potentially run out of gas if there is a sharp winter, Sir Jim said: "Yeah, in which case, what you would do is you'd shut down industry.

"Economically, we're in a bad place as it is after Covid so you don't really need to be shutting industry down, and that's not great for British industry if we're telling all our customers we can't supply them."

Wholesale gas prices have soared by 250% since the start of the year and although the energy price cap stops companies immediately passing these costs on to consumers, the winter price cap increased by £139 and there are fears it could increase by up to £400 next year if high wholesale prices continue.

Sir Jim said on probability, he thinks high prices will persist throughout the winter.

He said: "I think it's quite difficult to predict how long this sort of current situation is going to last, but I suppose if you were a betting man you'd assume it would probably run at least through the winter, because obviously our gas demand increases in the winter."

Sir Jim added that the government had made an error in not having a large enough storage of energy.

"Four years ago when we had the Beast From The East, we were within a day or two of running out of gas in the UK, if we had run out of gas it would have been a disaster," he said.

He also touched on the matter of government support. "I'm not a fan of government support as such - it shouldn't be necessary, but I think gas is a very strategic and important requirement for the UK economy, he said.

"They need to ensure that the UK economy can't be held to ransom because we haven't organised our gas situation very well."