Increased demand for gas and tension between Ukraine and Russia saw gas prices rise by 9 per cent in February, compared with January.

According to the latest energy report by Irish gas and electricity supplier Vayu Energy, higher year-on-year demand, concerns over North Sea supply earlier in February and heightened tension between Ukraine and Russia pushed the average price of wholesale gas up by 9 per cent in February.

However, despite the increase during the month, average wholesale prices for February were still down by 15 per cent year on year and down 27 per cent compared to February 2013. This translated into a reduction of up to 9.5 per cent for Irish businesses.

"While demand levels for gas are higher year on year, this is more a reflection of how significantly low demand was in 2014," says Joanne Daly, senior energy analyst at Vayu, adding that an increase in underlying demand from the power sector is being met by a wide range of supply options.

“This will help offset the upward pressure on prices experienced during February due to a reduction in North Sea output,” she said.

When it comes to electricity prices, average wholesale prices increased by 19 per cent on the average in January, and up 3 per cent compared to February 2014. This month-on-month increase in prices is largely due to lower wind generation in February and a month-on-month increase in gas prices, Vayu said.