Already buffeted by political chaos at home and abroad, the U.K. gas market must now operate without its biggest stabilizing force: the giant Rough gas storage facility under the North Sea.
     
The planned permanent shutdown of the Centrica Plc site, able to meet 10 percent of peak demand in winter, means Britain is becoming even more reliant on imports of liquefied natural gas or pipeline fuel from Russia and Norway. That sets up the possibility that traders would have to outbid Japan, the world’s biggest LNG buyer, and others to keep millions of homes warm.

Political uncertainty is making the supply game even riskier, with rules for international gas pipelines clouded in mystery as the U.K. negotiates an exit from the European Union.

And the diplomatic crisis this month involving Qatar, the nation’s largest LNG supplier, caused gas prices in Britain to jump the most since January as two tankers were diverted.
     
“It takes two weeks for a cargo of LNG to arrive from Qatar, which is not a politically stable place right now,” Graham Freedman, principal analyst for European gas and power at Wood Mackenzie Ltd. in London, said by phone.“That does raise the political implications quite a lot, along with Brexit. So it’s a perfect storm in terms of security of supply for the U.K.”
     
Last winter as much as 94 percent of the country’s gas came from sources other than storage. More than half of that was imports, mainly through pipelines from Norway. Statoil ASA, Norway’s state-owned producer, has repeatedly said it doesn’t plan to significantly boost exports, but can divert more fuel to Britain if needed.

Eoin Treacy's view

The graphic contained in this article highlighting the UK’s transition from being an energy exporter to importer represents a major inflection point for the economy which was exacerbated by the repercussions of the global financial crisis. 

With estimates of imports rising over the coming years developing a concerted program for a return to energy independence should be a national priority. The likelihood of achieving that goal while so many government resources are being devoted to Brexit negotiations is probably less than it would otherwise have been.

The silver lining is that UK natural gas prices are reasonably low right now having fallen from £60 to £35 since January. That condition has been influenced both by the decline in oil prices and surge in LNG volumes not least from Australia.

Meanwhile Centrica halved between September and January and has spent most of the year to date ranging mostly above 200p. A sustained break below 180p would be required to question support building in this area.