British households could see their energy bills increase by as much as £250 from July as the conflict in the Middle East continues to drive up wholesale gas prices, Energy UK has warned.
The industry trade body said supplier projections indicate a substantial rise in annual costs when Ofgem next reviews its price cap.
Cornwall Insight analysts forecast the regulator’s cap for the July to September period could climb to £1,827 annually for a typical dual fuel home, up from the current £1,641 level — representing a jump of more than 10 per cent.
Since fighting began in the region, oil prices have surged over 40 per cent while gas has risen by more than 60 per cent.
Energy UK is pressing the Labour Government to take immediate action in preparing assistance for those who would find rising costs most difficult to manage.
The trade body argues that any intervention should be directed specifically at low and lower middle-income households rather than providing blanket support to all bill payers.
When Russia invaded Ukraine in 2022, ministers introduced universal assistance that cost the Treasury more than £35billion.
Energy UK contends this figure could have been reduced to £12.5billion had support been restricted to those on modest incomes.
The organisation warned that the longer Middle East hostilities persist, the greater the likelihood that bills reach levels requiring Government subsidies for both domestic and business customers, as occurred during the previous energy crisis.
The industry body is calling for ministers to convene a “vaccine-style taskforce” that would bring together senior Government officials and energy sector data specialists to rapidly evaluate options for supporting struggling households.
When Russia invaded Ukraine in 2022, ministers introduced universal assistance that cost the Treasury more than £35billion
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GETTYThis group would undertake what Energy UK describes as a “sprint to urgently assess options” ahead of any potential intervention required later this year, particularly during the winter months.
Among the proposals is accelerating existing data-sharing initiatives to pinpoint customers already receiving welfare payments, disability benefits, or those living with serious health conditions.
Energy UK also suggests establishing an application process for individuals who do not claim benefits but may still require assistance.
Energy bills are on the rise
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GETTYAdditionally, the trade body recommends cutting policy costs on electricity bills, which would particularly benefit users of electric storage heaters — a group twice as likely to experience fuel poverty.
Dhara Vyas, Energy UK’s chief executive, said: “It is still too early to tell how significant an impact the conflict in the Middle East will have on British energy bills but it is clearly sensible to prepare and ensure any intervention that might be necessary is both cost effective and directed to help those who most need it.”
She noted that successive administrations have acknowledged the importance of better targeting support, yet progress on the necessary data-sharing arrangements has been sluggish.
The chief executive highlighted that household costs remain elevated compared to pre-Ukraine invasion levels
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GETTY“As we saw during the pandemic and previous energy crisis, the state can move quickly and inject a sense of urgency into work when it is really required,” Ms Vyas added.
The chief executive highlighted that household costs remain elevated compared to pre-Ukraine invasion levels, with mounting concerns about record levels of customer debt.