Gas prices in Europe could continue to rise as the continent braces itself for a shortage.
Prices of natural gas have increased by 36 per cent over the last month, with the fuel expected to continue to trade higher for the rest of the year as the Northern Hemisphere enters the winter.
Colder-than-expected weather could drive up requirements for heating, inflating prices.
Europe is facing a gas deficit after Russia, the biggest supplier to the region, began cutting supplies.
Prices in the UK grew by 560 per cent annually to reach £277 per megawatt on September 8.
Gas prices have also traded higher as inventories for the fuel in the US, the biggest producer, are at record lows. Natural gas prices were up by 2.7 per cent at $5.33 per million British thermal unit on Tuesday.
On Monday, Bank of America also said that prices for crude, a commodity closely linked to gas, could increase during the last quarter of the year, on the back of a cold winter.
Oil prices could hit $100 per barrel by the middle of next year if the Northern Hemisphere winter turns out to be colder than usual, the lender said.
“Global oil demand could surge by 1 million to 2 million bpd. Under this scenario, the oil market deficit this winter could easily exceed 2 million bpd and our $100 per barrel oil target for the middle of next year could quickly be rolled forward six months,” Bank of America said in a report on Monday.
The US bank expects Brent to remain “rangebound” in the second half of the year. The crude benchmark could hit $75 per barrel by the end of the year if the markets are not swayed by upside risks, it added.