Bord Gáis, the State-owned gas provider, has approached the energy regulator with an application for big rise in the price of gas in October due to an increase in wholesale price of gas.

The process is at an early stage, but data from the company indicates that it wants an increase of 30-40 per cent.

An increase at the higher level would bring the annual cost of supplying gas to the average home to €1,320 from €942.

With motorists already paying more for petrol as a result of the rise in oil prices, a rise in gas prices is likely to be accompanied by an increase in the price of electricity.

The price of domestic gas has risen by some 45 per cent since 2002 and the price of domestic electricity has risen by about 40 per cent in the same period.

Further increases in energy prices are being mooted as mortgage interest rates increase and as social partners seek to hammer out a new pay deal. While trade unionists argue that workers should be compensated for the higher cost of living, business says that would damage competitiveness.

The gas market is closely linked to the oil market and prices in the wholesale gas market in Britain, where Bord Gáis sources its imports, have risen significantly in recent months.

The latest application for an increase follows an 25 per cent rise in gas prices since the start of this year. Bord Gáis had sought a 30 per cent increase - long before the current oil spike - so an application for a higher rise this winter was expected.

A spokesman for Bord Gáis declined to discuss the details of the application but indicated that a dialogue with the energy regulator, Tom Reeves, had begun.

"We can confirm that we have commenced a review process with the regulator," he said.

It is likely that Mr Reeves's office will issue a draft response to the Bord Gáis increase in July and put it out to consultation before issuing its final direction in August.

With the depletion of Marathon Petroleum's Kinsale gas field off the Co Cork coast meaning that Bord Gáis must import the overwhelming majority of its supply, the delivery of gas from the Corrib field off the west coast has been delayed for years by local protesters who do not want the multinational Shell to run gas pipes through their land.