6th March 2026
Global gas prices have jumped sharply again, largely because of the escalating conflict involving Iran and risks to energy shipments through the Strait of Hormuz.
Here's how that affects UK electricity and gas bills.
Gas prices have surged again
Wholesale gas prices — the price energy companies pay on the market — have spiked dramatically in recent days due to the conflict and fears of supply disruption.
Because gas is such an important fuel in the UK energy system, this matters a lot:
Gas is widely used for home heating.
It also generates a large share of UK electricity.
So when gas becomes expensive, electricity prices usually rise too.
Why electricity follows gas prices
Even though electricity comes from wind, nuclear and other sources, the price of electricity in the UK market is often set by gas-fired power stations.
That means when gas gets expensive, the wholesale price of electricity rises as well.
But the price cap stops immediate jumps
The UK energy regulator Ofgem uses an energy price cap for standard tariffs.
Important things about the cap:
It limits the price per unit suppliers can charge.
It changes every 3 months, not instantly.
Right now:
The cap for April-June 2026 is expected to fall slightly to about £1,641 a year for a typical household.
So your bills won't jump immediately, even if gas prices spike today.
But prices could rise later in the year
Analysts are warning the current gas surge could push the cap higher later in 2026 if it continues.
Some forecasts suggest:
the typical annual bill could rise to around £1,800 from July if wholesale prices stay high.
That would be roughly a 10% increase.
Why the UK is sensitive to gas prices
The UK is particularly exposed because:
A large share of electricity still comes from gas power plants
Britain imports a lot of gas, especially LNG
Global events quickly affect wholesale prices
Experts warn that dependence on fossil fuels leaves energy bills vulnerable to geopolitical shocks.
Gas prices have jumped again this week.
Electricity prices usually follow gas, because gas sets the power price.
The price cap prevents an immediate increase, so bills won't jump overnight.
But if high gas prices continue, UK energy bills could rise again from July.
What analysts are saying
Several analysts say oil could reach $100-$120 per barrel if the conflict disrupts oil infrastructure or tanker traffic in the Strait of Hormuz.
Some officials warn that in a severe disruption, prices could spike to about $150 per barrel.
That scenario would likely require major supply interruptions, such as Gulf countries halting exports or shipping through the Strait being blocked.
Where prices actually are right now
At the moment:
Brent crude is roughly around $80-$88 per barrel, after jumping sharply since the conflict escalated.
So the market has already risen 10–20% in a week, but it’s still far below $150.
Why $150 is mentioned
The number comes up because the Strait of Hormuz is one of the most critical oil routes in the world:
About 20% of global oil supply passes through it every day.
If tanker traffic stopped completely, global supply would drop sharply, pushing prices dramatically higher.
Realistic scenarios analysts discuss
Energy economists usually describe three rough scenarios:
Limited conflict (most likely right now)
Oil: $80–$100
Serious disruption to shipping or refineries
Oil: $100–$120
Major shutdown of Gulf exports / Strait closed
Oil: $120–$150+
What it would mean for the UK
If oil ever reached $150 a barrel, it would likely cause:
much higher petrol and diesel prices
rising heating-oil costs
higher gas and electricity bills
more inflation across food and transport
But again, analysts stress this would require a major escalation or prolonged disruption, not just the conflict continuing at its current level.
In short:
Yes, some commentators are warning oil could reach $150 per barrel.
But that is a worst-case scenario tied to major supply disruption, not the base forecast.