Campaign coalition urges government to prepare emergency energy bill support as gas and oil price spikes continue.

At what point does the US-Israeli war on Iran become a war on everybody? Oil prices are up by over 50% on their pre-war level and global markets are in sharp decline. The International Monetary Fund estimates that every 10% rise in oil prices, sustained over a year, would correspond with a 0.4% increase in global inflation and a 0.15% reduction in economic growth.

Energy markets now face exceptional volatility. The US, with its domestic sources of gas, may feel more protected, but the rest of the world is likely to pay a very high price.

The impact here will be significant. Gas prices have soared to a three-year high as the Middle East conflict escalates. Attacks on energy sites in Iran and Qatar were followed by threats from US President Donald Trump to “massively blow up” a key Iranian gas field in retaliation.

Simon Francis, coordinator of the End Fuel Poverty Coalition, commented: “These gas and oil prices haven’t been seen since the winter of 2022/23 when an Energy Price Guarantee was needed to protect households from the worst excesses of our exposure to global markets. The reality is that households will face a ‘Trump Tax’ on their energy bills as a result of this war and the case for Government action to support households is becoming impossible to ignore. 

“We have written to Ministers with proposals to ensure support reaches the households most exposed to high energy costs first, while giving the Government the ability to scale up help quickly if the crisis continues.

“That means immediate support for households relying on heating oil, LPG and other off-gas fuels, help for heat network customers facing rising commercial energy prices, and targeted reductions in energy bills from July when the price cap rises. It also means faster action on energy debt, stronger winter support through the Warm Home Discount and reformed Cold Weather Payments, and an overhaul of electricity pricing so households do not pay more than they should.

“These are practical steps that can protect people now while complementing longer-term plans such as the Warm Homes Plan and moves to renewables, which are essential to bringing bills down for good.”

The End Fuel Poverty Coalition is urging the Government to prepare an emergency energy support framework to protect households from rising energy bills as global fossil fuel prices remain volatile. Millions of households could be plunged into fuel poverty if bills increase again from July. Tthe Coalition estimates that around 13 million households will be left spending more than 10% of their income on energy, with around 5 million spending more than 20%.

Some households are already feeling the impact of rising costs. Off-gas households relying on heating oil have reported refill prices doubling in recent weeks, LPG customers are facing rising prices, while heat network customers could soon face steep increases as energy supply contracts expire.

The immediate measures recommended include a new, longer-term, Alternative Fuel Support Scheme for households relying on heating oil, LPG and other off-gas-grid fuels, as well as support for heat network customers who face rising commercial energy prices.

The proposal also recommends preparing a targeted reduction in energy unit rates from July if the Ofgem price cap rises significantly, alongside faster rollout of a national energy debt relief scheme to address record levels of household debt.

For the winter, the Coalition is calling for reforms to existing schemes including further expansion of the Warm Home Discount and strengthening Cold Weather Payments so support reaches vulnerable households earlier. Ministers are also urged to speed up reform to electricity pricing and prepare a scalable universal support package that could be activated quickly if energy prices spike further.

Simon Francis added: “Rather than making snap decisions, the Government should establish an emergency support framework now, so households know what support can be expected. Reducing energy price spikes benefits the whole country. It helps limit inflation, reduces pressure on household finances, prevents worsening fuel poverty and cuts the health impacts associated with cold homes.

“This support should be funded fairly. Energy companies and other parts of the energy industry make huge profits during periods of price volatility, so it is only right that windfall taxes and excess profits are used to help protect households from another energy price shock.”

Maria Booker, Head of Policy, Fair By Design, commented: “The Government must use the next two and a half months to design an emergency support package that is both effective and fair. This shock is yet  another reminder of why the Government must accelerate progress on data‑matching capabilities so that support can be better targeted.”

Uplift Deputy Director Robert Palmer said: “Everyone in the UK is going to pay the price if this reckless conflict continues via a ‘Trump War Tax’ that could add thousands of pounds to people’s bills. We risk seeing higher energy bills, more expensive petrol, pricier mortgages and bigger food bills.”

Morgan Vine, Director of Policy and Influencing at Independent Age, said: “It is clear that support is needed for older people in financial hardship who are understandably anxious about what the fuel crisis could mean for them. With over half of older people on a low income already finding it a struggle to keep up with their energy bills, many are already making tough choices, not turning the lights on at night, heating only one room even in the depths of winter, or washing in cold water.  

“Older people on low incomes can’t afford to absorb any more costs; they’re already at breaking point. The UK Government must take comprehensive action now to protect everyone on a low income from sky-high energy prices.”

Jonathan Bean, spokesperson for Fuel Poverty Action, said: “Any emergency support must recognise that electric-only homes face much higher unit prices than oil and gas households due to our rigged energy market. The Government must urgently break the link between gas and electricity which allows firms to inflate the price of cheap renewable energy.

“The Prime Minister must also get a grip on the huge profits that already make up £500 of the average energy bill. If the Government was serious about bringing down our bills, they would work with Ofgem to cut profits and pass the savings back to us.”

Susie Elks, Senior Policy Advisor on the UK Power System at E3G commented: “The government must lower the cost of ‘hidden taxes’ on bills, which add £11bn to households and business energy bills. 

“They must solve the energy debt crisis, which is adding £50-£70 to every household’s bill. They must find a way for us to modernise our energy networks, which have been chronically underinvested in, whilst managing the costs to households.”

Ian Preston, Director of Development and External Affairs from the Centre for Sustainable Energy commented: “Another fossil fuel price crisis, when many households still haven’t recovered from the last one, underlines the urgent need to support households to switch to heat pumps powered by homegrown renewable energy generation as quickly as possible.” 

The End Fuel Poverty Coalition brings together more than 100 charities, health organisations, housing groups, trade unions and consumer bodies working to end fuel poverty across the UK.

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