The hike by the regulator, a non-ministerial government department, comes as Prime Minister Keir Starmer is under intense pressure to relieve some of the economic fallout he has said is from the war.
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“Today’s price change reflects continued volatility in global energy markets. This means higher wholesale gas prices, driven by ongoing conflict in the Middle East, is impacting the price we pay for energy,” Ofgem CEO Tim Jarvis said in a statement.
Wholesale energy prices are the largest single factor contributing to Ofgem’s domestic price cap, which is set on a quarterly basis using a formula that also reflects suppliers’ network costs and environmental and social levies. The new cap of £1,862 ($2,504) a year for average use
