Martin Lewis, the founder of MoneySavingExpert, has issued a stark warning regarding the rising cost of household energy bills in the UK. In an update shared on X (formerly Twitter) on 9 September, he highlighted a sharp increase in wholesale natural gas prices, which is set to push domestic energy costs higher.
Lewis pointed to a recent chart showing UK natural gas prices reaching approximately 196 GBp/thm-the highest since the peak of the energy crisis triggered by the Ukraine conflict. “The situation for domestic UK energy bills really isn’t looking good,” he stated. He explained that since gas prices influence electricity bills due to the UK’s reliance on gas for power generation, this surge will have widespread effects.
The immediate consequence is that the rates available for new fixed-term energy deals will become more expensive. Over the longer term, this increase feeds into the energy price cap set by Ofgem, which regulates the maximum charges suppliers can impose.
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Currently, the price cap scheduled for January 2027 is anticipated to rise by 10–15% compared to the October 2026 cap. This follows an already confirmed 3.6% increase in October and a significant 12.6% rise in July.
These wholesale price changes are driven in part by ongoing geopolitical tensions in the Middle East, particularly linked to the US-Iran conflict and disruptions to liquefied natural gas (LNG) shipping routes. This has pushed UK gas prices to multi-year highs, with forecasts suggesting continued pressure on energy prices into early 2027.
It is important to note that the price cap directly affects consumers on standard variable or default tariffs, while those secured on fixed-rate deals remain protected until their contracts expire.
Lewis' advice for consumers on variable tariffs or the default price cap is to consider whether it might be prudent to switch to a fixed-rate energy deal before prices increase further. He cautions that the recent spike in gas prices makes securing a new fixed deal more costly and likely to worsen in the near future.
To summarise the current price cap situation:
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From 1 July to 30 September 2026, the cap is set at around £1,663 annually for a typical dual-fuel household paying by Direct Debit, based on average usage of 2,500 kWh electricity and 9,500 kWh gas.
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From 1 October 2026, a confirmed increase of about 4% (£60 per year or £5 per month) will raise the cap to approximately £1,723. This hike is primarily driven by gas price rises, although electricity cost increases are somewhat mitigated by a temporary removal of VAT.
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The January 2027 price cap, to be announced in late November, is expected to rise further by roughly 10–15% compared to October levels. Some industry estimates vary, projecting increases from high single digits to mid-teens percentages, reflecting ongoing volatility in wholesale gas prices.
Consumers are encouraged to stay informed about these changes and review their energy tariffs ahead of the upcoming price cap adjustments.