Clydebank-based Together Energy has become the latest supplier to cease trading.
Along with subsidiary Bristol Energy, the company supplies about 176,000 domestic customers and one non-domestic customer.
It is understood to have about 300 staff.
Together Energy stated that the sustained increase in wholesale prices had made it "untenable" to continue.
In November, the business said it was looking to secure "long-term funding for growth", but a backer could not be found in time.
"We regret to inform you that the company will cease trading with immediate effect," read a statement on its website. "We want to thank you sincerely for your custom over the past five years."
Energy regulator Ofgem added: "Under Ofgem’s safety net, customers’ energy supply will continue and funds that domestic customers have paid into their accounts will be protected, where they are in credit.
"Domestic customers will also be protected by the energy price cap when being switched to a new supplier.
"Customers of Together Energy Retail will be contacted by their new supplier, which will be chosen by Ofgem.
"In recent weeks there has been an unprecedented increase in global gas prices which is putting financial pressure on suppliers - Ofgem is working closely with government and industry to make sure customers continue to be protected this winter."
Neil Lawrence, director of retail at Ofgem, continued that a new supplier will be chosen, urging customers not to switch.
"We will update you when we have chosen a new supplier, who will then get in touch about your tariff.
"Any customer concerned about paying their energy bill should contact their supplier to access the range of support that is available."
Since wholesale gas prices started to spike, more than 20 retail energy suppliers have collapsed in the UK, including Edinburgh-based People's Energy.
It supplied gas and electricity to about 350,000 homes and 1,000 businesses..
Many energy suppliers have been hit not only by high wholesale prices, but also by their inability to pass on extra costs to customers protected by fixed tariffs, or the regulator's price cap.
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