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British Gas, EDF, EON, Ovo and Octopus customers can look forward to an immediate £129 reduction in their bills come July, as the energy price cap is predicted to lower. Households will
likely see their typical yearly energy bill drop by £129 to £1,720 this summer, all thanks to the anticipated new price cap from regulator Ofgem. However, wholesale gas and electricity
prices have surged by 30% since mid-December, fuelling further cost of living worries for consumers amid global gas supply uncertainties, exacerbated by the ongoing tensions between Russia
and Ukraine, reports Birmingham Live. Craig Lowrey, Principal Consultant at Cornwall Insight, has recently commented on these forecasts, highlighting that while the lowering of the price cap
is much welcomed, it somewhat offers limited relief amidst the cost-of-living crisis many families face. Mr Lowrey remarked this week: "The fall in the price cap is a welcome
development and will bring much-needed breathing space for households after a prolonged period of high energy costs." He continued by adding a note of caution: "It's a step in
the right direction, but it should be taken in context. Prices are falling, but not by enough for the numerous households struggling under the weight of a cost-of-living crisis."
Introduced on 1 January 2019 by Ofgem, the Price Cap was designed to protect millions on costly variable tariffs from overcharging, limiting unit costs of gas and electricity used and
setting a maximum daily standing charge for grid connection. The Energy Price Cap experienced a 6% increase on 1 April, escalating to £1,849 annually for a typical dual-fuel household paying
by Direct Debit. If you're on a fixed tariff, the price cap won't impact you as your prices are secured for the duration of your contract. The energy market has shown more
stability recently, but unexpected events can occur. Global politics significantly influence energy prices. For instance, if conflicts in Ukraine or the Middle East intensify, wholesale gas
prices could rise, leading to increased bills. Discussions are ongoing regarding the calculation of the next price cap and other energy regulations which could affect prices in 2025,
altering these forecasts.