Martin Lewis issues ‘bad news’ for UK household bills due to ‘Middle East’ | Personal Finance | Finance

Money expert Martin Lewis is telling gas and electricity customers that their prices are set to increase due in part to the ongoing conflict in the Middle East.

Although prices are set to fall by 7% next Tuesday for two thirds of UK households, gas and electricity bills are set to go up significantly in October, then January, then again in April, according to the latest calculations. Speaking on the most recent episode of The Martin Lewis Podcast, Martin said: “The energy price cap is going down by 7% on July 1. So not very long away now…we’ve known that for about six weeks.

“Now the energy price cap dictates the price that two thirds of homes in England, Scotland and Wales pay for their energy bills. Everybody who’s on the standard, the default, the you’ve done nothing, you’ve not fixed, or your fix ended and you’ve not acted since. You are on a price cap tariff.

“Now, for those homes, it was previously thought that come October we weren’t gonna see a rise and it was gonna be flat for the rest of the year.

“Unfortunately, what is happening in the Middle East has changed those predictions. Currently, we’re due to see a rise of 2-3% in October, and then up on top of that another 1% in January and up on top of that another 3% in April.

“Now up on top of that the further out you go, the more crystal ball gazing it is. But overall we’re now facing a landscape where the price is expected to go down just for the summer months, which will get people raging out there ‘it always goes down for the summer and up for the winter’. It doesn’t actually always, it is a subject of wholesale rates, but it is likely to be what happens this year.

“If you’re one of those people who sits on the energy price cap… while you may see your bills drop by 7% in July, expect to see it start to go up again from October.”

Following up on what he said on his podcast, Martin then tweeted this afternoon that predictions have risen ‘rapidly’ over the last couple of weeks and it would take a ‘chunky drop’ to bring bills down in time for the next price cap.

He posted on ‘X’: “Bad news! Ofgem’s energy Price Cap that dictates the rate 2/3 homes in Eng, Scot & Wales pay, is now predicted to rise even more than before.

“I’ve knocked up this table showing today’s new average predictions (from 3 big firms) for the Cap for someone on supposed ‘typical use’; though far more relevant is the predicted % change as that’s roughly what’ll hit all homes.

“The Cap is already locked in to fall in July… what counts now is what happens next. We’re now 1/3 of the way through the assessment period for the 1 Oct Cap, and the predictions for that have risen rapidly over the last couple of weeks.

“This is because wholesale rates, which are the main changeable factor in the Price Cap, have spiked, meaning the predictions have gone up.

“It would now take a chunky fall in wholesale rates for October not to be a rise. After that is more crystal ball gazing though.”

Martin added that energy customers should look for a fix, as the best deals are currently 15% cheaper than those on the current price cap, which would save you even more as prices rise.