Latest forecast warns energy bills could hit £6,500 from April as gas prices spike again
Energy bills could hit £6,552 by next April, experts have predicted, after a spike in gas prices added nearly £500 to the forecast price cap.
It will heap further pressure onto struggling households who are already facing being forced to make the choice between heating and eating amid the rising cost of living this winter.
Gas prices soared as markets opened on Monday after Russia said it would run maintenance on a key gas pipeline that connects the country with Germany.
State gas giant Gazprom said that the Nord Stream 1 pipeline would be shut off entirely for maintenance for three days next week.
But experts fear it might not reopen as Russia applies pressure on Europe’s economy.
The price cap prediction for April from energy experts at consultancy Auxilione is £463 higher for April, following the latest market movements.
The firm expects the price cap to rise to £3,576 from the start of October, hitting £5,066 in January before rising even further to £6,552 from April.
It will then fall back a little, but still remain at what would have been record prices previously, hitting £5,897 in July 2023 and £5,548 three months later.
“The nervousness of the market appears to increase day by day as we edge closer to winter delivery, now just five weeks away, and no big positive news on the horizon,” Auxilione said.
“The planned outages in a week’s time have captured the attention of the market and are driving concerns further – as yesterday’s market activity demonstrated.”
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Ofgem is set to announce its energy price cap decision for October on Friday, 26 August.
Analysts widely expect the cap to top £3,500, up from £1,971 today.
Even this rise will put enormous pressure on households over the winter months when heating is turned on in homes.
All households have been promised £400 of help, with more for the vulnerable. But experts say this support - which was announced by former Chancellor Rishi Sunak in May - will not go far enough if the latest price cap forecasts prove correct.
On Friday, NHS bosses warned the country was barrelling towards a "humanitarian crisis" this winter, leaving people at risk of falling sick if the government does not do more to help ease the pain of soaring bills.
Labour, the Liberal Democrats and most major energy suppliers have backed similar plans to cap prices at current levels.
That would take enormous pressure off households – and spread the costs of a tough winter over several years.
But the government has said it will not announce further bill support until a new prime minister is in place.
Outgoing Prime Minister Boris Johnson will leave office on September 6, and will be replaced by either Rishi Sunak or Liz Truss following the conclusion of the Tory leadership contest.