British businesses are staring at another energy cost shock after wholesale gas prices jumped around 5 per cent, triggered by Donald Trump declaring the ceasefire with Iran “over” following a fresh wave of US strikes and renewed attacks on tankers in the strait of Hormuz.
The benchmark Dutch front-month gas contract at the TTF hub rose €2.424 to €49 per megawatt hour, touching €49.76 at one stage, its highest level since 11 June. The British front-month contract climbed 6 pence to 116.75p per therm.
The trigger was Trump’s declaration that the memorandum of understanding intended to end the conflict with Iran was “over”, after both sides resumed hostilities. The US launched a new round of strikes and Tehran hit American bases in the Gulf, while several tankers were attacked in the strait of Hormuz on Tuesday.
For UK firms, the timing is grim. Wholesale energy costs had been easing since mid-June, and oil had only recently slid back to pre-war levels as shipping cautiously returned to the waterway. That recovery now looks to have been unwound in a matter of hours.
Why the strait matters to your energy bill
About a fifth of the world’s liquefied natural gas supplies
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