Britons face ‘risk premium’ for energy as US-Israel war on Iran intensifies

London, United Kingdom – Andrew, a 70-year-old retiree from the eastern English city of Norwich, had enrolled months ago in a fixed-rate energy plan for 18 months, learning from earlier price shocks caused by wars.

Days ago, Ofgem, the energy regulator for England, Scotland and Wales, announced a 4 percent increase of the energy price cap from October 1, 2026, a result of the sharp rise in wholesale gas prices due to the United States-Israel war on Iran.

“The situation doesn’t look any clearer … the fog of war is still there, and who knows when it will blow away,” said Andrew, who requested that his surname be withheld for privacy.

The end of his fixed-rate plan is not something he likes to think about.

“I don’t think there’s going to be clarity,” he said. “I can’t see that the current state of geopolitics will allow for any resolution. I’m starting to think, if it’s not one conflict zone, it will be another.”

According to Ofgem, 35 percent of households in England, Scotland and Wales are on similar, fixed-rate energy plans, and will not be immediately affected by the Ofgem price cap increase.

Most, however, will face higher bills in the winter, an added blow to a nation already struggling amid a continued cost-of-living crisis.

A household using a regular level of energy will pay about 60 pounds ($80) a year more.