Investors await Centrica's update as shares sit at a more than 10-year low

 
Courtney Goldsmith
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Gas Dispute Threat To UK Power Supplies
Centrica would be hit hard by a cap on energy prices (Source: Getty)

British Gas owner Centrica will release a third quarter trading update this week amid a government push to cap energy prices that has plunged it into hot water.

Centrica's share price has tumbled around 30 per cent this year as Prime Minister Theresa May increases government intervention of the sector over so-called "rip off" energy prices.

May first proposed a cap on energy prices during the General Election campaign, and earlier this month Centrica's shares were hit yet again after energy minister Greg Clark defended the cap in front of a cross-party group of MPs.

Shares in Centrica closed at 163p on Friday, a low not seen for the utility giant since 2003.

Chief executive Iain Conn tried to boost investor confidence last month by buying up more than £173,000 worth of shares in the company.

The company will continue to face uncertainty in the months ahead as ministers work out the finer details of the legislation.

The energy price cap has not been the only recent shakeup in the sector, though.

SSE earlier this month revealed it was in talks with the Germany's Npower over plans to merge their gas and electricity businesses in Britain.

Analysts at Macquarie said the move to consolidate was positive for SSE and Npower's owner Innogy and neutral to Centrica.

"Indeed we see scope for a further Big 6/Big 6 merger (E.On/Scottish Power), which could follow a similar route as SSE/Npower. We do see EDF at least exploring this possibility of consolidation, but we see it unlikely that Centrica will be able to undertake a similar exercise," they said.

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