The Money Saving Expert founder warned households would need to act quickly
Households concerned about their energy bills after the current price cap wears off may be able to grab a cheaper deal on fixed tariffs, but these may not be around for long. Martin Lewis urged households to act quickly after noticing a domino effect from the ceasefire in the Middle East.
He explained that the ceasefire in the Middle East had trigger some fixed energy tariffs to drop below the April price cap. However, the longevity of these deals may depend on the longevity of the ceasefire itself.
The ITV star noted he’s not ‘properly back on social yet’ but wanted to share his insights as he believed this break in the tense energy market could ‘give respite to some’.
The Money Saving Expert (MSE) founder particularly urged people that are currently on the price cap, which will be households on variable or non-fixed tariffs, to check if they could avoid the increase expected in July by using the Cheap Energy Club through the MSE website.
The Ofgem energy price cap dropped by nearly 7% at the start of April. It will be refreshed in July which is expected to skyrocket due to the influence of the conflict in the Middle East.
The energy price cap is the maximum amount energy suppliers can charge you for each unit of energy and standing charge if you’re on a standard variable tariff. It doesn’t affect fixed energy tariffs during their agreed term.
Lewis has been on a break for a few weeks but made a brief return to share the news on X as he explained some fixed tariff deals have dropped below the current price cap. However, he warned these deals could disappear as quickly as they arrived.
Previously, Mr Lewis noted that the crucial factor when deciding whether to fix your energy bills or not may lie in how much risk you’re willing to accept.
‘Fixing’ your energy bill refers to getting a fixed tariff which will keep your bills at the same level for an agreed period of time. However, during this time the price cap could rise or fall meaning you may end up paying more or less than households on variable tariffs.
From April 1 until June 30, the energy price cap is 6.6% lower compare to the previous price cap. This will save the average household on a variable tariff around £117 on their annual energy bill.
MSE’s Cheap Energy Club warns: “Energy wholesale rates are spiking due to conflict in the Middle East, meaning many firms have pulled fixed deals, or made them more expensive. Whether you should fix now depends on how risk averse you are and what you think will happen.
“If you’re one of two-thirds of households on the Price Cap, we know rates are locked in until July, and if the turmoil ends before then, we’d expect cheaper fixes to return – if so, sticking on the Cap could be the best outcome.
“But if the current situation lasts a long time, fixing now is likely the better option, but you may pay a premium. You can do a full comparison to see your options.”
