Household energy bills are expected to rise significantly this summer, with forecasts indicating an increase of nearly £300 due to the impact of the Middle East conflict on UK prices.

Analysts at Cornwall Insight predict that Ofgem’s price cap will increase to £1,929 per year for a typical dual-fuel household between July and September—an increase of £288, or 18%, compared to levels in April.

This forecast represents a slight decrease from earlier predictions of £1,973, which Cornwall Insight attributes to a “partial steadying” in wholesale markets following a pause in strikes on energy infrastructure and tentative ceasefire signals related to the Iran conflict.

However, the consultancy cautions that a rise in July is now “effectively unavoidable,” as the spike in wholesale gas and electricity prices from March is already factored into the cap calculation. Prices are unlikely to drop back to pre-war levels in the near future.

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This anticipated increase follows a 7% reduction in bills (£117) effective April 1, bringing costs down to £1,641. This decline was partly due to government actions that removed green levies and fulfilled a commitment to lower average household costs.

Ministers are preparing contingency measures, suggesting that targeted support may be introduced if prices rise as expected. Ofgem is set to confirm the next price cap on May 27, leaving households facing renewed uncertainty over energy costs as geopolitical tensions continue to affect global markets.

Craig Lowrey, principal consultant at Cornwall Insight, said: “A rise in July is pretty much unavoidable, but how high prices go remains to be seen.

“There is some relief in the timing, summer is when energy demand is at its lowest, which should soften the impact on household energy expenditure.

“If higher wholesale prices continue, it will be the effects on the October cap that have the most impact, and that is when the question of government support for households is likely to be revisited.”

Minister for energy consumers, Martin McCluskey, said: “Tackling the affordability crisis is our number one priority and I know many families will be thinking about how events in the Middle East might impact the cost of living at home.

“We will continue to fight people’s corner through this crisis and, as the Energy Secretary has said, if it’s necessary to intervene, we will.”

Shadow energy secretary Claire Coutinho said: “The Government must adopt the Conservatives’ cheap power plan to cut bills by £200 immediately by taking VAT, taxes and levies off energy bills without costing taxpayers a penny.

“We would cut bills for everyone rather than taxing working people to fund yet another bailout for people on benefits.”