Gazprom has given warning that European consumers should expect stiff increases in natural gas prices as the soaring cost of oil feeds through into contracts for the sale of Russian gas into Europe.

The cost of wholesale natural gas will rise by between 15 and 20 per cent next year, Alexander Medvedev, the deputy chief executive of Gazprom, said.

He added that even greater increases could follow if the European Commission pushes through measures to break up Europe’s gas grid.

The Russian gas giant is at loggerheads with the Commission over its plans to strip European gas companies of their pipelines. The “unbundling” proposal, which is opposed by other monopoly suppliers such as Gaz de France, would affect Gazprom’s investment in downstream gas distribution in Germany.

“The proposal will inevitably create a situation where prices will grow,” he said. “Liberalisation . . . doesn’t work in such infrastructural industries as power generation and especially gas.”

The soaring price of crude oil, which this week flirted with $100 per barrel, will soon feed through into natural gas prices, stoking inflationary pressures in Europe. British consumers are unlikely to be spared the effects of a Russian price increase as the two markets are linked by an inter-connector pipeline between Norfolk and Belgium.

In Britain’s free-for-all competitive gas market, contracts for gas are bought and sold daily on a futures exchange. However, Russian gas is sold under long-term contracts with big European energy companies such as Ruhrgas, owned by E.ON, and Gaz de France.

The price of gas sold under these contracts is not linked to a spot market but is indexed to a basket of alternative fuels, mainly crude oil and heating oil. Typically, the price is adjusted quarterly and is based on the average price of the fuel basket over the preceding six to nine months.

Because of the time lag, the surge in crude oil has yet to affect European gas prices, but consumers already smarting from the soaring price of petrol will feel the full impact of expensive energy in their domestic fuel bills next year.

Gazprom’s argument with the Commission over the unbundling of gas pipelines is set to intensify. The proposal to strip utilities of their physical infrastructure strikes at the heart of Gazprom’s strategy to extend its reach downstream into Europe.

The Commission wants more competition and has taken steps to develop new supplies from Central Asia, promoting Nabucco, a vast pipeline project linking Baumgarten, a gas hub in Austria, to central Turkey.

Gazprom has ridiculed Nabucco and this week scored a point against the Brussels-backed project, signing an agreement to create a new company to develop South Stream, a 900km (560mile) pipeline bringing Russian gas across the Black Sea into Bulgaria with onward transport into Greece and Italy.

The Russian utility piled further pressure on Nabucco with talks this week between Alexei Miller, Gazprom’s chairman, and the Turkmenistan Government.

Viktor Zubkov, the Russian Prime Minister, said: “We have agreed to sign the deal on the Caspian gas pipeline in the near future in order to speed up its construction.”

A new pipeline targeted at Russia would be a defeat for the US and the European Union, which have lobbied intensively to secure Turkmen support for a pipeline across the Caspian to Azerbaijan, linking with BP’s South Caucasus pipeline to Turkey.

Royal Dutch Shell has pulled out of a $419 million (£199 million) deal, announced just two days ago, to acquire a large stake in Regal Petroluem’s Ukrainian gasfields, after Regal appointed a new management team on Thursday. A Shell spokeswoman said: “We were not expecting it and are deciding not to proceed. Our memorandum of understanding was with the previous management team.”

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