The UK’s largest gas storage facility is facing an uncertain future as the impact of the ongoing conflict in the Middle East is being felt on the Yorkshire coast, where Centrica Energy’s Rough gas storage site is located.
Although the UK sources most of its gas from Norway rather than Qatar, concerns over LNG exports from the Gulf have rippled through global gas markets, pushing up wholesale prices and increasing the cost of filling storage sites such as Rough.
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With European storage levels already lower than usual following a cold winter, buyers are competing more aggressively to secure LNG cargoes and refill storage ahead of winter, increasing the cost and commercial risk of storing gas at facilities such as Rough.
The UK may not rely directly on Qatari gas, but it remains exposed to global LNG market volatility through its interconnected gas trading system.
Centrica Energy CEO Chris O’Shea said the company has already lost eight weeks of the ideal refill window and warned time is running short to refill the site ahead of winter.
He said Rough’s production licence expires in April and cannot be justified commercially without government backing. Unless a support agreement is reached, Centrica has indicated it will allow the licence to lapse.
He has urged the government to introduce a support mechanism that would enable Centrica to refill the site, describing Rough as a vital component of the UK’s energy security.
A proposal was discussed between O’Shea and Energy Secretary Miatta Fahnbulleh last week. Under the plan, Centrica would fund the injection of gas into Rough and receive a government storage fee.
The government would then decide when to withdraw and sell the gas, taking any resulting profit or loss.
It is the second time in less than a decade that geopolitical events have pushed Rough into the centre of the UK’s energy security debate.
The site was closed in 2017 after the government declined to support it. It was partly reopened in 2022 when Russia’s invasion of Ukraine caused global energy prices to spike.
Centrica described Rough as a nationally important asset and said it wants to invest further, but only under a long-term regulated framework.
It supplied around 5% of UK gas demand last winter. The UK has one of the lowest levels of gas storage in Europe and typically relies heavily on imports and European markets during the colder months.
According to figures reported by The Observer, Rough contained 31% less gas at the end of June than a year earlier. At the start of April, average gas storage across the EU stood at 28%, below levels recorded at the start of the previous three summers.
The update came as Centrica Energy, which owns British Gas and Bord Gáis Energy, reported adjusted operating profit of £737m ($983m) in the first half of 2026, down from £900m ($1.2m) in the same period last year, primarily reflecting asset disposals linked to Spirit Energy and production outages.
The company said weaker market conditions and warmer weather also weighed on its performance.
Europe approaching ‘energy crisis territory’, says Woodmac
Gas storage remains a concern across the wider European market. According to consultancy Wood Mackenzie, historically low inventories and ongoing disruption in the Middle East have pushed spot gas prices more than 50% above their June lows.
European storage currently stands at just over 50%, a historically low level for late July, while Asian LNG demand has returned to 2025 levels, intensifying competition with Europe for available cargoes.
The consultancy said the pressure is likely to persist, with Qatari export capacity not expected to fully recover until the second half of 2027.
“Low European inventories, strong Asian demand and limited new LNG supply growth almost guarantee elevated prices through this winter and into 2027,” said Massimo Di Odoardo, Vice President of Gas and LNG Research at Wood Mackenzie.
Under Wood Mackenzie’s base case, European storage reaches just 75% by 1 November, well below the five-year average of 90%. Should disruption to the Strait of Hormuz continue for a further two months, storage levels are expected to remain below 80%.
The consultancy warned that while Europe is not facing a repeat of the 2022 energy crisis, market conditions are becoming increasingly strained and the continent is ‘approaching energy crisis territory.’
Prices remain below the record highs seen after Russia’s invasion of Ukraine, and investment in renewable energy has reduced the power sector’s exposure to gas.
However, limited short-term alternatives to gas, combined with plans to ban Russian LNG imports from January 2027 and tighter methane emissions rules, could restrict Europe’s supply flexibility at a time when it is most needed.
