Gas prices hit two-year high: Why drilling the North Sea won’t lower UK energy bills

15 February 2025, 10:15 | Updated: 15 February 2025, 10:31

As we approach the third anniversary of the Russian invasion of Ukraine, gas prices have just hit a two-year high, and as anyone who pays a gas bill knows the price crisis isn’t over.

For some the solution is more gas: drill the North Sea or frack Lancashire. But that won’t bring down the UK’s gas bill. The gas price is largely set by international markets – even though we imported very little Russian gas when Ukraine was invaded, we still saw our prices spike, because gas produced here is owned by the companies that get it out of the ground and they sell it on these markets to the highest bidder.

And according to the International Monetary Fund, the UK has been ‘worst hit’ by the gas crisis because unlike other countries we’re highly dependent on it for both heating homes and generating electricity.

Perhaps the obvious solution is to reduce our demand for gas and so lower our vulnerability to price spikes. The Energy Crisis Commission, made up of consumer and business groups, certainly thinks so, pointing to rolling out renewables, insulating homes and installing more electric heat pumps as the way to avoid a future crisis.

A small number of people will always take a dislike to new technologies, but they are out of touch with the public. Solar and wind are the most popular ways to generate electricity backed by 82% and 79% of the British people respectively.

Anyone who calls for the slowing down of the renewables roll out is essentially calling for more reliance on gas, which we will increasingly get from abroad. North Sea output has been declining for decades and any more drilling will produce limited amounts which will again be sold to the highest bidder.

“The best way of reducing the UK’s future exposure to these volatile prices is to cut fossil fuel consumption on the path to net zero…shifting to a renewables-based power system... Any increases in UK extraction of oil and gas would have at most, a marginal effect on the prices faced by UK consumers in future.”

Words from the UK’s independent advisors the Climate Change Committee in late 2022, around a year after gas prices started to spike ahead of the Russian invasion of Ukraine.

They apply as much today as they did then.

• Jess Ralston is the Head of Energy at the Energy and Climate Intelligence Unit (ECIU)

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