Energy bills rise 'inescapable' if prices stay high, says British Gas boss

One of the UK's largest energy suppliers has said an increase in household bills was "inescapable" if oil prices remain high due to the Iran war.

“- Published One of the UK's largest energy suppliers has said an increase in household bills was "inescapable" if oil prices remain high due to the Iran war”

BBC

Chris O'Shea, boss of British Gas-owner Centrica, told the BBC that the effective closure of the Strait of Hormuz had affected the supply of oil far more than gas, and that it was still "too early to speculate" on what this would do to energy prices.

BBC

But he pointed to a forecast by consultancy Cornwall Insight that bills in England Scotland and Wales could rise by an average of £332 from July, after falling by £117 from April due to the energy price cap.

If the situation remained the same in that time, "then I think that's inescapable", he said.

Since the US-Israel war with Iran began, oil and gas prices have soared, with crude up 45% to $106 a barrel.

Around 20% of the world's oil usually flows through the Strait of Hormuz, but Iran targeting shipping through the vital waterway has effectively brought it to a complete halt.

BBC

But O'Shea said only 3-4% of the global gas supply had been lost due to the closure of the strait.

Asked about government support with energy bills, O'Shea said "targeted" would be "far better than blanket help".

“- Published One of the UK's largest energy suppliers has said an increase in household bills was "inescapable" if oil prices remain high due to the Iran war”

BBC

On Monday, the prime minister will hold an emergency meeting with senior ministers and the Bank of England governor to discuss measures to counter the potential impact of the war in the UK, including on the cost of living.

Housing Secretary Steve Reed told theprogramme that the government was already taking action on energy bills, including a £53m package for homes struggling with a sharp increase in the price of heating oil.

The discussion of ways to mitigate any energy price rises came after the government's cost-of-living tzar, Lord Walker, who is also chief executive of Iceland, suggested in the Sunday Times that energy companies and petrol stations should have their profits temporarily capped as oil prices jump.

But Reed appeared to rule this out, saying a cap was not currently necessary.

BBC

"We're monitoring this, hour-by-hour," he said.

"As intervention is required, the government in making appropriate interventions but we're already focussing on keeping bills down."