UK’s energy bills to rise as Mideast war pushes up gas prices
Ofgem, which sets the price cap every quarter, said the cap would increase by 4% from October, adding around US$7 per month to the average bill.
In October, British energy bills are expected to increase as the ongoing conflict in the Middle East drives up gas prices, according to the sector regulator Ofgem. The energy price cap, which sets the maximum amount suppliers can charge customers, will rise by 4% in October, adding approximately £5 to the average monthly bill. This brings the typical annual gas and electricity bill to around £1,723.
The conflict in the Middle East has resulted in a shortage of gas supplies due to the closure of the key Strait of Hormuz. Prime Minister Andy Burnham has pledged to remove value-added tax (VAT) from electricity bills in October, aligning with the projected rise in the energy price cap. However, Ofgem suggests that the full benefit of VAT reduction may not be immediately evident on electricity bills due to the continued high gas prices resulting from global events.
Interestingly, gas prices remain lower than they were during the 2022 energy crisis following Russia's invasion of Ukraine. Despite this, Britain's annual inflation rate rose to 2.9% in July, primarily due to the 13% hike in the energy price cap.
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- UK’s energy bills to rise as Mideast war pushes up gas prices freemalaysiatoday.com
