What does the war in the Middle East mean for UK energy prices? | June 2026

Why have global gas prices gone up?

The Strait of Hormuz – the major shipping channel where oil and gas are transported from the Middle East to the rest of the world – has been more or less a no-go zone since March, blocking nearly 20% of global gas shipments for over three months. 

The world’s largest gas terminal in Qatar is still partly out of commission due to strike damage, and business leaders have indicated it could take weeks, months or even years to do the repairs necessary to get it working again.

That massive supply shortage has kept the price of gas higher globally, and because electricity prices are tied to gas, they have risen as well.

Amid huge pressure on the warring countries to reach an agreement, on June 18, the US and Iran signed an initial peace deal aiming to end the war. This "memorandum of understanding" is a positive starting point but analysts have pointed out a range of highly contested issues that make it very fragile. More negotiations lie ahead.

For so many reasons, most of all for the human life at stake, we’re hoping for a swift and peaceful resolution. If that doesn’t come soon, we could see a more dramatic impact on prices as we head toward the end of the year, with EU and Asian nations competing to fill their gas storage for winter.

What’s going to happen with my energy tariff?

If you’re on our variable tariff, Flexible Octopus, the earliest you’ll see the recent market spikes impact your bills is July.

Your prices are protected by the energy price cap, which lasts until the end of June. The July price cap, adds about £220 to the typical dual-fuel bill, mostly driven by wholesale gas becoming more expensive. These changes will come into effect on July 1.

If you’re on a fixed tariff, your rates are locked in til your contract ends. When it’s time to renew, we’ll show you our best prices available at the time, which change regularly based on the market.

Will tariff prices go up longer term?

We were forced to push up our fixed prices sharply after the war started. It’s impossible to predict the future: they could go up more, or they could come down – it largely depends on what happens in the Middle East.

So, should I fix my prices?

None of us has a crystal ball that shows how long this conflict will last, so we can’t know for sure what’s best.

If you’re on a fixed tariff with several months left to go, then it might be best to stay on that, as otherwise you’ll be paying more in the short term. Check your tariff (scroll down til you see your tariff and meter info).

If you’re on Flexible Octopus, or nearing the end of a fixed tariff, and feeling uncertain about ongoing conflict in the Middle East, you may be weighing up your options.

If you need certainty about your energy bills for the next year, we're still offering fixed tariffs at the moment. They're more expensive than they were a few weeks ago, but if you want to beat the July cap or just can't risk future rises over winter, they could be a good choice.

It’s also worth bearing in mind that our latest fixed tariffs include exit fees, so you’d want to consider whether you might need to switch again later on down the line.

In most cases you can change your tariff online, and if not, email hello@octopus.energy and we'll help.

Why do some of our tariffs have exit fees?

You’ll be able to fix online if you’re on Flexible Octopus or you’re within 49 days of the end of your fix. If you can’t see the option to fix online, you can chat to our team instead – email hello@octopus.energy.

I’m on Octopus Tracker or Agile Octopus – should I move to a standard tariff right now?

That's genuinely your decision and we'd never push you either way. What the data shows is that with these dynamic, wholesale-based tariffs, you may pay more than standard tariff customers in the short term, but often these spikes don't erase long-term gains.

If you'd like security and stability during this turbulence, you're free to fix now or move to Flexible Octopus, our price cap protected tariff – read more about those options above.

Whatever you decide, we're here to help.

I'm a business customer, what does it mean for me?

We've made a separate business-focused blog, just for you.

Check it out: For businesses - what does the conflict in the Middle East mean for my energy prices?

What would it actually take for the UK to be 'energy secure'?

So what's the solution?
There's no single fix, but there's a clear direction:

Reduce how much gas we need. More wind, solar and heat pumps gets us closer to self-sufficiency and less exposed to global shocks. The technology is ready and getting cheaper every year.

Reform our electricity markets so that cheap renewable power actually brings bills down. Right now, even green electricity is priced according to gas costs, and because the grid can’t always move power from where it’s generated to where it’s needed, we actually pay wind farms to turn off and gas plants to replace them. That wasted wind cost nearly £1.5 billion last year alone. Effectively, it’s a market design problem, not an energy problem, and it's solvable.

Use domestic North Sea gas while we still need it, rather than importing it from regions vulnerable to conflict. This isn’t a silver bullet, and it won't bring prices down overnight, but it makes more sense than shipping gas from the other side of the world.

Get on with nuclear, but do it efficiently. New plants are at least a decade away and government funding needs to be carefully managed. It's a long-term piece of the puzzle, not a short-term fix.

So when does this get better?
The technology is there. Renewables are cheaper than gas. Batteries cost a tenth of what they did ten years ago. The barrier now is market reform and political will. We can't control what happens in the Strait of Hormuz, but we can control how exposed we are when it does.

That's what “energy security” actually means.

What is Octopus actually doing about this — are you just talking about it?
We're one of Europe's largest renewable energy investors, with 5.7 GW of wind and solar projects worth £8.5 billion globally and £2 billion committed to new UK clean energy by 2030. We manufacture our own Cosy heat pump to make green heating affordable, and we've already built the UK's first zero-bills community — 113 homes in Essex with solar, heat pumps and a shared battery, with no energy bills guaranteed for ten years.

We’re also pushing hard for the market reforms that would actually fix this — publicly campaigning for zonal pricing, which would save consumers at least £2 billion a year and break the link between gas and electricity prices, so global crises stop hitting British households so hard.

We already know gas isn't the long-term answer. Everything we build points in the other direction.