Energy bills across the UK are expected to fall slightly from April. But new global tensions could quickly change the outlook. Experts are warning that the escalating conflict in the Middle East may push up global oil and gas prices, which could eventually feed through into UK household energy bills.
Here’s what’s happening and what it might mean for your energy costs.
Why events in the Middle East affect UK energy prices
Energy markets are global. Even if the UK does not import large amounts of oil or gas directly from conflict zones, disruption in major supply regions can still drive prices higher worldwide.
One of the key concerns is the Strait of Hormuz, a narrow shipping route between the Persian Gulf and the Gulf of Oman.
According to the US Energy Information Administration, about 20% of global petroleum liquids consumption passes through the strait. The EIA also says about 20% of global LNG trade moved through it in 2024.
That matters because when global supply looks less secure, wholesale prices can rise. Those higher costs can then feed through to suppliers and, ultimately, to households
Could UK energy bills rise this year?
Possibly. Some media reports currently suggest that household energy bills could rise by around 10% from July if wholesale gas prices remain high. Industry analysts estimate this could add around £160 a year to the average household energy bill for customers on variable tariffs.
However, it’s important to note that these predictions are still uncertain.
Ofgem reviews wholesale energy costs over several months when setting the energy price cap, which limits the unit price suppliers can charge customers on standard variable tariffs.
The next cap covering July to September will be announced in May. What happens in global markets between now and then will play a major role.
Energy bills will still fall slightly in April
Despite recent market volatility, energy bills covered by the price cap are still due to fall from 1 April 2026. Ofgem says the annual cost for a typical dual-fuel household paying by Direct Debit will fall to £1,641, down £117 from the previous quarter.
Government policy changes are also removing some energy scheme costs from bills, which could reduce annual household costs by around £150.
However, if wholesale prices continue to rise, those savings could be short-lived.
Should households consider fixing their energy tariff?
Before the latest market turmoil, many consumer experts had already been advising households to look at fixed deals where they were cheaper than the price cap. That may still be worth considering, but the market is changing quickly.
Some energy suppliers have already started withdrawing or adjusting their fixed deals due to market uncertainty.
If you are considering switching:
- Compare tariffs carefully before making a decision
- Avoid rushing into a deal that is significantly higher than current prices
- Check exit fees and contract terms before signing up.
Energy markets can move quickly, so it’s important to weigh up both short-term savings and longer-term risks.
The bottom line
For now, energy bills are still set to fall slightly in April.
But the situation remains unpredictable. If instability in the Middle East continues to push global oil and gas prices higher, UK households could see energy bills rise again later this year.
