The National Drought Group meets after what was the driest July in England since 1935. Only 35% of the average rainfall for the month fell, and parts of England and Wales are now in the middle of a four-day "extreme heat" alert.
Local media, including the BBC and Sky News, reported that several regions of the country could declare a drought. The government said no decisions had been taken before the meeting.
Earlier on Friday, Yorkshire water announced a hosepipe ban would begin on Aug. 26, forbidding customers from using hoses to water gardens, wash cars or fill up paddling pools.
"The hot, dry, weather means that Yorkshire's rivers are running low and our reservoirs are around 20% lower than we would expect for this time of year," Yorkshire Water's director of water, Neil Dewis, said.
The company, which services about 2.3 million households and 130,000 business customers across northern England and parts of the Midlands, is the latest regional water firm to announce usage restrictions.
A ban on hoses and sprinklers for South East Water customers came into effect on Friday. Thames Water, which supplies 15 million people around London, has said it is also planning restrictions.
Britain's environment minister, George Eustice, urged water companies this week to take precautions to protect water supplies.
Any drought declarations would be regional and would not automatically trigger specific government interventions. However, they could lead water companies to enact more stringent restrictions for households or businesses to preserve supplies.
Much of Europe has faced weeks of baking temperatures that have triggered large wildfires, drained water levels of the Rhine River in Germany and seen the source of Britain's River Thames dry up further downstream than in previous years.
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And meanwhile the privatised water companies are raking it in, whilst allowing billions of litres of water to be lost every day due to leaking pipes.