Domestic gas supply is at risk of running low as the owners of Queensland's gas export projects find themselves with insufficient reserves to deliver on their contracts.

The squeeze could place further pressure on domestic gas prices at a time when rising demand is already pushing them sharply higher.

More gas is flowing north to feed Queensland's gas export projects Credit:Brendan Esposito

Already, gas is now flowing from the southern states into Queensland to feed the voracious appetite of its export projects, which is adding to the pressure being seen on domestic gas price.

Employers in Sydney warned last week they may have to halt production because of the spike in gas prices, which poses a threat to hundreds of manufacturing jobs in the months ahead.