Tag: Middle East Conflict

Politicians debate Spring Statement as energy risks still loom

Chancellor Rachel Reeves used her Spring Statement to defend the Government’s economic plan after the Office for Budget Responsibility downgraded near-term growth forecasts.

But against a backdrop of rising tensions in the Middle East and renewed volatility in global energy markets, the statement did nothing to reassure households.

A spokesperson for the End Fuel Poverty Coalition, said

“Away from the hot air generated by politicians in Westminster today, households will be watching the news to see how the latest conflict hits their energy bills.

“Time and again we see how global tensions push up fossil fuel prices, driving costs higher and squeezing living standards. Yet while families face that uncertainty, energy giants have generated more than £125bn in UK profits since 2020.

“The Chancellor is right in her Spring Statement that the world has become more uncertain, with one of the biggest risks to family finances being the over-exposure to volatile oil and gas markets.

“If the Government is serious about tackling the cost of living and strengthening economic resilience, it must accelerate investment in homegrown renewables, roll out a nationwide insulation programme and reform energy pricing so bills are no longer tied to fossil fuel volatility.

“In an unstable world where the UK’s own gas fields will not be able to meet demand in the years to come, energy security and affordable energy are two sides of the same coin.”

Iran conflict pushes gas prices higher, but the risk for bills lies ahead

Gas wholesale prices have now hit levels not seen since 2023 (as at 09:00 3 March 2026 they were at levels last seen on 30 January 2023, up 36% year-on-year) and the cost of heating oil is also surging (up 39% year on year).

A spokesperson for the End Fuel Poverty Coalition, said:

“Global price shocks translate into higher energy costs because the UK remains so heavily dependent on gas and the mature North Sea basin will be unable to meet domestic demand within the next few years. Our energy system also links the cost of gas to electricity prices because the grid still relies on gas-fired power stations, although this influence eased last year.

“The conflict has already started to push wholesale gas prices to levels we’ve not seen since 2023, but for now most households are shielded by the Ofgem price cap.

“Bills are effectively protected until at least 1 July 2026 because the April to June cap has already been set. The cap works by smoothing out price spikes and delaying the passing on of cost increases to consumers. But that also means the real risk is what happens next.

“If wholesale prices fall back, the impact may be limited. But if elevated prices persist, they will affect Ofgem’s next price cap decision in May, which takes effect from July.

“It is also unclear how suppliers will respond in the fixed tariff market. In periods of uncertainty they often withdraw or increase the price of deals to avoid exposure to volatile wholesale costs.

“Households that rely on heating oil are even more exposed, and the latest surge in those prices will be a major concern for rural and off-grid families needing to refill in the coming weeks.

“This is a stark reminder that the UK is still dangerously exposed to volatile international markets. The only lasting protection for households is to cut gas demand through a nationwide insulation programme, expand homegrown renewables and reform energy pricing so bills are no longer tied so closely to global fossil fuel prices.”

Gas and heating oil prices spike as energy risks mount

The UK Natural Gas price has just hit a 12 month high and is still rising fast (as of 1300 GMT it is 13% up on 2025) as Qatar suspends LNG gas production and exports.

This will impact the energy price cap which takes effect on 1 July 2026. Heating oil is also at a 12 month high – 30% up year on year, which will be a concern to rural communities.

A spokesperson for the End Fuel Poverty Coalition, commented:

“Fresh highs in wholesale gas prices underline that UK households remain dangerously exposed to volatile global markets and that the UK’s own gas is running out. Within a few years we will no longer be able to meet heating demand from the North Sea, leaving families even more exposed to price shocks from abroad.

“As long as our energy bills remain dependent on gas, households will keep being hit by global price shocks. The most durable way to protect people is to cut demand through a nationwide insulation programme, invest in homegrown renewables and reform energy pricing so bills are no longer tied to volatile fossil fuel markets.

“At the same time, energy share prices are surging again. With industry lobbying the Treasury to end the Windfall Tax early, there is a real danger the crisis once again becomes a cash machine for the energy giants.

“Ministers must reject industry pressure and remember that a handful of energy firms have generated more than £125bn in UK profits since 2020.”