Chamber News
Additional Increase on Energy Bills
4 March 2022 • Sarah Medcraf
UK energy bills could reach as high as £3,000 a year as oil and gas prices surge amid the Ukraine conflict, the energy industry has said.
Russia's invasion of Ukraine has made the trading, banking and shipping sectors reluctant to buy Russian commodities, pushing up prices.
The price of Brent crude oil rose above $119 a barrel to the highest since May 2012, while gas prices rose as well.
Average UK petrol prices have also hit a new record.
The RAC said petrol reached £1.52 a litre for the first time, while diesel rose to a high of 155.79p.
Russian oil and gas exports are exempted from Western sanctions for now, but the prospect of further action by the US and the EU is stifling Russian trade.
Emma Pinchbeck, the chief executive of the energy industry body Energy UK, said: "It's a really worrying time for both customers and industry.
"We've been saying since the autumn that we'd expect bills to go up again in October. With what we're seeing in Ukraine and in the oil and gas markets, we're now expecting those to go up further."
She said that if oil prices remain at elevated levels "you can expect bills to be anywhere between £2,500 and £3,000 in October depending on the tariffs people have and what happens in the market".
The prices that people pay for energy and fuel depend on wholesale markets, which can go down as well as up.
But average UK household energy bills are already set to rise to around £2,000 in April when the price cap is increased.
Gas prices had hit record highs last year due to colder winters which put pressure on supplies and reduced the amount of reserves countries had stored up.