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Wholesale gas prices have fallen back to 2018 levels - why are energy bills still so high?

Journalist: Katie Elliott, Daily Express

ended 21. August 2025

Cornwall Insight released its final prediction for Ofgem's next energy price cap this week. It forecasts bills to rise by 1% in October (£1,737).

A graph on Trading Economics compares wholesale prices from now to 2018. The prices are roughly the same now, but energy bills are more than £500 higher. 

How are energy providers getting away with charging so much? What impact is this having on households? What will it take for bills to finally drop back to regular pre-crisis levels? 

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David Belle
Founder and Trader at Fink Money
The price cap by OFGEM is likely the reason for this.

When the price cap has explicitly been set to permit firms to recoup debts from the pandemic, this is what happens. A complete dislocation between wholesale price and the price paid by consumers but more importantly, businesses, since there is no price cap there.

In addition, the shift to intermittent green energy causes the marginal cost of fossil fuel energy to increase, since it's deemed that less of it is required. So when the wind stops blowing, some other form of consistent power has to step in to provide energy to the grid.