Woodside boss Meg O’Neill has lobbed a thinly veiled swipe at those calling for price caps and taxes to battle soaring energy prices on the east coast, saying such steps would only exacerbate the issue.

“That type of market manipulation would have serious long-term consequences, reducing investment in new supply [and] making the energy shortfall and price pressure worse in future years,” O’Neill told a business breakfast in Perth on Thursday.

Federal Treasurer Jim Chalmers has vowed to tackle by year’s end the skyrocketing power bills confronting households and businesses amid government forecasts prices will jump 56 per cent over the next two years in the global energy crunch driven by Russia’s war on Ukraine.

Earlier this week, Treasury secretary Steven Kennedy told parliament the war-driven price shocks “bring into scope government intervention”, arguing government should look to reign in prices. There is speculation this could come in the form of a national reservation scheme or tax.

However, the plan would see Western Australia’s state reservation policy scrapped, a legacy of the Carpenter government which makes 15 per cent of gas exports available for WA consumers and has kept a lid on local prices.

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O’Neill said she believed the focus on market intervention was misplaced and stability was crucial.

“Western Australia has to date been largely immune from the supply and price shocks we have seen on the east coast and internationally, through a combination of natural advantages and stable policy settings,” she said.

“It is absolutely critical, both for our industry and for many of the businesses represented here today, that this remains the case.