LONDON, Sept 22 (Reuters) - Two more British energy suppliers stopped trading on Wednesday, leaving more than 800,000 customers potentially facing higher bills, after a jump in natural gas prices pushed the sector to the brink.

Avro Energy and Green Supplier Limited became the latest providers to say they would cease trading, following a handful of others that have exited the market this year. Between them, Avro and Green held 2.9% of the market's domestic customers.

The country's energy regulator Ofgem and business minister Kwasi Kwarteng earlier warned parliament that the soaring gas prices would force more suppliers out of business and that the industry should prepare for a tougher environment.

The regulator will now select alternative providers to take on the customers and an industry price cap should limit the extent of any rise in monthly bills.

"In recent weeks there has been an unprecedented increase in global gas prices which is putting financial pressure on suppliers," Ofgem said. It added that it was working with the government and the industry to protect customers this winter.

Natural gas prices have spiked as economies reopened from COVID-19 lockdowns and as high demand for liquefied natural gas in Asia pushed down supplies to Europe, sending shockwaves through industries reliant on natural gas.

Already meat producers https://www.reuters.com/world/uk/turkeys-wont-be-christmas-menu-if-co2-shortage-persists-2021-09-21 have suffered as high energy prices forced a fertilizer producer to halt production, denying the food industry the carbon dioxide by-product that is used to stun animals for slaughter and pack food.

In the energy market, small providers that had launched in recent years have been hit by the jump in costs. From more than 70 suppliers in 2018, there are just over 30 now.

Kwarteng told a parliamentary select committee that the industry had to prepare for longer-term high prices. Analysts have said that they expect them to remain high until next year.

Kwarteng said Britain has robust systems to cope with company failures, and small firms which had recently entered the market should not expect new state handouts.

"I think they should look to their own resources, and look at their own business models.

"It cannot be right for companies that have entered the market recently, and now essentially in difficult times, stretching out a hand for taxpayers' money," he said.

Jonathan Brearley, the head of Ofgem, told parliament that the rise in prices was unprecedented.

"It really is something that we don't think we've seen before at this pace," he said. (Reporting by Kate Holton, Paul Sandle and William James; Editing by Alison Williams, Elizabeth Piper and Mark Porter)