Ofgem’s price cap for July to September is projected to reach £1,929 for a typical dual-fuel household — an increase of £288, or roughly 18%, compared to April’s cap.
From April, the energy price cap dropped by 7%, cutting average annual bills to £1,641. But analysts warn this relief may be short-lived, with bills forecast to rise again to £1,929 from July.
The rising pressure on household finances is being driven by disruption in global energy markets following Iran’s effective closure of the Strait of Hormuz, a key shipping route for oil and gas.
Because gas-fired power stations often set the marginal price for electricity in the UK, wholesale gas prices feed through to both gas and electricity bills, amplifying the effect for households.
The price cap has come down since early 2023 but remains 30% higher in real terms than before the energy crisis. Wholesale gas prices continue to be the main driver of costs.
Ministers are now considering further support for vulnerable households as the likelihood of a summer price surge grows. Ofgem is due to confirm the next price cap level on 27 May.