British households have paid an average of £3,400 extra on energy bills over the past five years, as global gas price shocks linked to international conflicts continue to push up costs across the UK.
New analysis highlights the lasting impact of the energy crisis that began in late 2021, worsened by Russia’s invasion of Ukraine in 2022, with further pressure now emerging from rising global oil prices linked to the US-Iran conflict.
The findings from the Energy and Climate Intelligence Unit (ECIU) show that a typical dual-fuel household could be paying around £4,800 more in total energy costs by autumn 2026 compared with pre-crisis levels. That represents an 87% increase since the start of the gas price surge in 2021.
According to the report, gas bills alone are now more than £2,600 higher over five years, while electricity costs are up by over £2,200. Much of this increase is driven by volatile wholesale gas prices on international markets.
Although government support schemes in 2022 and 2023 helped cover around £1,400 of costs per household, families are still left significantly worse off, with an estimated net increase of £3,400 in direct energy spending.
The ECIU also found that roughly three-quarters of the additional cost comes from wholesale gas prices, with VAT and related charges contributing to the overall rise in household bills.
Energy analyst Jess Ralston warned that UK households are being hit by repeated global energy shocks.
She said families are still carrying debt from previous price spikes and have limited financial resilience left to absorb further increases, especially with another rise in the Ofgem price cap expected later this year.
The energy regulator Ofgem is due to announce its next price cap on 27 May, which will set energy bills from July through to September 2026.
Economists warn that rising oil and gas prices are also feeding into wider inflation, affecting food, transport, and manufacturing costs across the UK economy. Inflation recently rose to 3.3%, with further price pressures expected in the coming months.
Industry analyst Rob Morgan said higher production costs are likely to either squeeze business profits or be passed directly on to consumers, increasing household financial strain.
The report has also reignited debate over the UK’s long-term energy strategy. Some argue for increased North Sea drilling, but others say global markets mean domestic production has limited impact on prices.
Ralston said the UK’s shift towards renewable energy and net zero targets is already helping to reduce reliance on imported gas and stabilise electricity prices over time.
She added that around 90% of North Sea oil and gas has already been extracted, and further drilling would not reverse the long-term decline in domestic production.
Meanwhile, a separate report from the Institute for Public Policy Research estimated that energy network firms could make up to £5bn in excess profits between 2021 and 2026, potentially allowing for household rebates of up to £183 per year. However, industry figures have strongly disputed those claims.
With energy prices remaining closely tied to global political instability, experts warn that UK households are likely to face continued volatility in bills over the coming years.