What the Iran Conflict Could Mean for Energy Prices

Updated: March 12, 2026

Over the past few days, headlines have been dominated by the escalating conflict involving Iran and the potential disruption to global energy markets.

Why the Middle East Matters for Global Energy

The Middle East remains one of the most important energy regions in the world. A significant portion of global oil and liquefied natural gas (LNG) is transported through the Strait of Hormuz, a narrow shipping route between Iran and Oman.

Under normal circumstances, around one fifth of the world’s oil supply passes through this route every day. Because of this, any threat to shipping in the area immediately causes concern in global energy markets.

When conflict escalates in the region, markets react quickly as traders anticipate potential supply disruptions.

How the Market Has Reacted

We’ve already seen a strong reaction across global energy markets.

Oil prices have surged, with Brent crude rising above $110 per barrel, the highest level seen since the energy crisis of the early 2020s.

Gas markets have also responded sharply. Wholesale gas prices have recorded their largest two-day spike on record, reflecting concerns that disruption to LNG exports could tighten global supply.

What This Means for UK Businesses

For businesses in the UK, increases in global energy prices don’t usually translate into higher bills immediately.

However, they can feed through into wholesale electricity and gas costs over the coming weeks and months.

The key factor now will be how long the disruption lasts. If shipping routes stabilise quickly, markets may begin to settle. But if supply remains restricted or tensions escalate further, volatility could continue and prices may remain elevated.

Why Energy Strategy Matters During Volatile Markets

Periods like this highlight the importance of having a clear energy procurement strategy in place.

Businesses that leave procurement decisions until their contract renewal date can find themselves exposed to sudden market spikes.

By contrast, many companies choose to secure energy pricing strategies years in advance, helping protect themselves from short-term market volatility.

Planning Ahead for Energy Renewals

If your energy contract renewal is approaching, now is an important time to start reviewing your options.

Monitoring the market and exploring procurement strategies early can help businesses avoid being locked into contracts during periods of extreme price movement.

How GEAB Can Help…

At GEAB, our team monitors energy markets closely and works with businesses to develop procurement strategies that minimise risk and provide greater cost certainty.

If you’d like to understand how current market conditions could affect your business energy costs, get in touch with our team for expert guidance.

Get in touch – Green Energy Advice Bureau