ENERGY firms have hiked the cost of fixed-price deals by more than £100 in just two days after the Ukraine crisis wreaked havoc on wholesale gas prices.
Suppliers have raised prices in a bid to convince consumers to sign up for long-term contracts instead of “default tariffs” protected by price caps.
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A 12-month fixed deal, which would previously set you back £3,240, is now a whopping £200 dearer than it was on Thursday.
And according to price comparison site Uswitch, that’s triple what it cost back in 2020.
The cheapest deal offered by energy companies has risen in price by around £15.49 a DAY since December – from £1,798.30 to £2,789.99.
As the Russian invasion of Ukraine continues, wholesale gas prices have soared as Europe fears Russia will cut the continent’s supply off.
Firms have taken advantage of the concern created by the fluctuating gas prices, by raising the cost of deals to encourage customers to register for long-term contracts instead.
Companies hope to move away from “default tariffs”, that are protected by the Ofgem-imposed price cap.
The limit, which restricts what energy suppliers can charge per unit of energy, is rising in April.
The rules mean average households will be invoiced no more than £1,971 per year for gas and electricity over a year.
‘VOLATILE’
Energy suppliers are now toting sky-high fixed price deals by suggesting it provides more reliability with bills in the long term.
With the price cap changing every six months and rising again in October – expected to be around £3,000 – Brits bills can vary.
But according to The Telegraph, homeowners will be better off on price-cap protected deals, unless Ofgem raised the bar to over £5,000 in October.
If they increased it to that capacity, it would mean the average 12-month contract would be the cheaper option.
Dr Craig Lowrey of Cornwall Insight, an analyst, said: “Following the catastrophic events in Ukraine and the subsequent supply concerns across Europe, wholesale prices have been extremely volatile.
“The Government will need to be ready with ways to mitigate the impact on consumers, with an increase in financial support to households likely to be a necessity, in addition to renewed considerations on support to business customers.”
Firms launched flash sales and offered up cheap fixed deals due to the rocketing wholesale prices.
But staying on the energy price cap will be the cheapest available deal for many households.
Remember, before signing up to any deal make sure you work out how much it will really cost you and read the terms and conditions carefully.
