British households can expect their energy bills to climb by £196 annually from July, according to fresh forecasts from Cornwall Insight.
The energy consultancy predicts Ofgem’s price cap will reach £1,837 for a typical dual fuel home between July and September, representing a 12 per cent jump compared to the current April level.
Back in early March, Cornwall Insight had forecast bills could surge by £332 to reach £1,973 when the new cap takes effect.
The regulator will confirm the official cap figure by 27 May. The current cap stands at £1,641 following a seven per cent reduction in April.
Wholesale energy markets remain turbulent due to the ongoing conflict in Iran, which began on 28 February.
Cornwall Insight has warned that a July price cap increase is “effectively unavoidable” because soaring wholesale costs are already factored into the calculation.
The consultancy sees little prospect of prices dropping to pre-war levels in the coming weeks. The latest forecast does signal some relief from the sharp price spikes witnessed when hostilities first erupted.
However, British consumers will still face substantial rises in their gas and electricity costs as the Middle East conflict continues to drive up wholesale energy and oil prices across global markets.
Energy bills set to jump £196 in July
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GETTYSimon Francis, coordinator of the End Fuel Poverty Coalition, said: “The damage from the latest oil and gas price crisis is already baked into price cap predictions.
“Millions of households in fuel poverty are going to be asked to find more money for energy on top of prices that are already unaffordable.”
He added: “A smaller than planned increase is not relief. It is still an increase that will push more people into crisis and generate higher profits for the oil and gas industry.”
Mr Francis pointed out that families already struggling with energy debt have no financial cushion to absorb further rises, with global events continuing to dictate what consumers pay.
The Strait of Hormuz, through which a fifth of global crude oil typically passes, has been disrupted since the US-Israeli offensive began
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GETTYHe called on ministers to outline both immediate and longer-term assistance for struggling households.
The Strait of Hormuz, through which a fifth of global crude oil typically passes, has been disrupted since the US-Israeli offensive began.
“Iran’s foreign minister Abbas Araghchi announced on Friday that the waterway was “completely open” for commercial vessels during the ceasefire period.
The Government has indicated it will consider further targeted support as part of contingency planning
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PABrent crude dropped sharply to 89.15 dollars per barrel on Friday afternoon, down from 98.39 dollars at Thursday’s London close.
However, Iran’s state broadcaster IRIB has since confirmed the strait is “now closed” again, with Tehran claiming Washington failed to meet its obligations.
The Government has indicated it will consider further targeted support as part of contingency planning, and this week extended electricity bill assistance to 10,000 businesses.