Why global events still have such an impact on UK business energy prices
28 Aug 2026
Published in: Member News
Global events can quickly affect UK energy prices. For businesses, the key isn’t predicting the perfect time to buy, but understanding consumption, contract dates and appetite for risk. Good energy procurement is part of good financial planning.
An event thousands of miles away can change the price available for a UK business energy contract.
It can seem strange, particularly when nothing has changed at the business itself.
But energy is an international market.
During 2026 we have seen again how geopolitical uncertainty can feed quickly into wholesale gas prices and, in turn, UK electricity markets.
The conflict in the Middle East pushed up wholesale energy prices earlier this year and created significant volatility as markets reacted to changing expectations around supply and future risk.
The reason this matters to UK businesses is partly the continuing role of gas in electricity generation and price setting.
Britain is producing increasing amounts of renewable electricity. Wind and solar generated a record combined 30.6TWh during the first quarter of 2026, accounting for 39% of the UK power mix including imports.
That renewable generation can help reduce exposure to volatile international fuel markets. However, it does not remove that exposure altogether.
When markets become concerned about future gas supplies, wholesale prices can respond long before an actual shortage occurs.
That distinction is important for businesses.
Energy markets don't simply price what is happening today.
They also price expectations about tomorrow.
A supplier offering a business a two or three year contract has to consider the cost and risk associated with supplying energy over that future period.
This is why trying to identify the single “best time” to buy energy can be misleading.
Markets can fall.
They can also change direction very quickly when new information appears.
For many businesses, the more useful question is how much price risk they are prepared to carry.
Some organisations need certainty because energy represents a significant proportion of operating costs.
Others have more flexibility.
Understanding that risk alongside the business's consumption and contract position can be more useful than trying to predict the bottom of the market.
For Black Country businesses in manufacturing, engineering, hospitality and other energy intensive sectors, that distinction can be particularly important.
Energy procurement should therefore sit alongside financial planning.
Know when contracts end. Understand how much energy the business actually consumes. Look at whether that consumption is changing.
Then consider the market and the options available.
The world may continue to give energy markets plenty to react to.
Businesses cannot control that.
They can control how prepared they are when it happens.
For help reviewing an existing commercial energy position or planning an upcoming renewal, visit www.yourenergyconsultant.co.uk.
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