UK households could see energy bills rise by up to 500 pounds a year as the conflict in the Middle East drives oil and gas prices sharply higher, according to the Resolution Foundation.
The think tank warned that sustained price increases could add roughly one percentage point to inflation and derail an expected improvement in living standards. Global benchmark Brent crude oil jumped 4.7 per cent to 81.40 US dollars a barrel, its highest level since January 2025, while European gas prices surged by as much as 40 per cent.
Impact on Scottish Households
Scotland is particularly exposed due to the high proportion of homes reliant on gas central heating. Rural households using oil or LPG for heating face even steeper increases as domestic heating oil prices track international crude closely.
If elevated prices persist, energy regulator Ofgem is expected to revise the price cap upward in coming quarters. The government could intervene with a support package, but this would cost billions at a time when public finances are already stretched.