The UK domestic energy price cap will rise 4% from October 1 to December 31, 2026, lifting the typical annual bill for a dual-fuel household paying by direct debit to £1,723 from £1,663. The £60 increase will affect about 22 million households on default or standard variable tariffs and leaves bills at their highest level in three years. Ofgem said higher wholesale gas prices linked to the ongoing conflict in the Middle East, including the Iran war, were the main driver. Wholesale gas prices have risen 61% over the past three months, with gas unit rates set to increase 8.7% to 7.97 pence per kilowatt-hour and electricity rates 0.8% to 26.32 pence. The government’s temporary removal of VAT from electricity bills saves households about £45 a year, less than the latest increase. Energy Secretary Miatta Fahnbulleh said households were under severe cost-of-living pressure, while Shadow Energy Secretary Claire Coutinho said the government should put cheap energy first. About 11 million customers with fixed-rate deals are temporarily shielded, and Cornwall Insight projects a possible further 9% increase in January 2027.