Oil & Gas

British Gas announced a 35 per cent rise in gas prices, the biggest increase imposed by a leading energy company. British Gas is the UK's largest energy supplier, selling gas to 10m households. Of these, the 5m households that buy both their gas and electricity from British Gas face a 25 per cent jump in their bills. The decision, which followed smaller energy group EDF Energy raising its gas bills by 22 per cent and its electricity bills by 17 per cent last week, is likely to be followed by similar rises by other leading suppliers. Centrica , owner of British Gas, angered consumer groups by revealing first-half pre-tax profits of almost £1bn one day after the increase. BP reported the biggest quarterly profit for a British company. Soaring oil and gas prices helped push underlying net profit up 56 per cent to $8.6bn (£4.3bn) in the second quarter. Tony Hayward, the chief executive who took over last year, has been trying to turn the company round after years of disappointing performance, and the figures signalled that his efforts may be bearing fruit. However, BP's shares have been under pressure because of its problems in Russia. The group is facing a bitter battle for control of TNK-BP, its venture owned 50-50 with the Alfa-Access-Renova group of Russian Billionaires. Royal Dutch Shell announced the largest expenditure programme in its history, saying it would spend £36bn in 2008 compared with $25bn last year, as it seeks new sources of oil and gas to boost reserves and production and to better exploit its existing resources.