Middle East Tensions and Energy Market

What this means for UK businesses right now

Events in the Middle East are once again influencing global energy markets.

Recent reports suggest UK wholesale gas prices have jumped by as much as 50% following concerns about supply disruption. The increase has been linked to fears of reduced liquefied natural gas (LNG) shipments after QatarEnergy reportedly halted LNG production following Iranian drone attacks on its facilities.

Whenever supply from the Middle East is threatened, markets react quickly. Even the possibility of disruption can move prices because traders start pricing in risk.

For businesses, this raises an obvious question:

Is this about to push energy prices sharply higher again?

Why markets are reacting

The Middle East remains one of the most important regions in the global energy system.

Large volumes of LNG move through the region, and any disruption to production or shipping routes can ripple across international markets. When traders believe supply might tighten, prices often rise long before any physical shortages occur.

That appears to be what we are seeing now.

Wholesale gas prices have moved significantly in response to the news around Qatar’s LNG production and the wider geopolitical tension in the region.

Why the impact on the UK may be more measured

Despite the headlines, there are a few reasons why the UK may not see the same level of disruption as some other markets.

First, Britain produces roughly 45% of the gas it consumes domestically, with the remainder imported. Only a relatively small proportion of those imports come directly from Qatar.

Second, since the energy crisis of 2022, the UK and Europe have diversified supply routes. Increased LNG imports from the US and other regions, alongside stronger storage levels across Europe, have reduced reliance on any single source.

Third, the UK energy system now includes a larger share of renewable generation, which helps reduce the overall demand for gas during certain periods.

Taken together, these factors provide some protection against immediate supply shocks.

But global markets still affect UK prices

Even if the UK does not rely heavily on Qatari gas directly, the global market still matters.

Gas is traded internationally. If supply tightens in one part of the world, buyers compete for the remaining supply elsewhere. That pushes prices up across the entire market.

In other words, the UK may not face a direct shortage — but it can still feel the price impact.

This is why geopolitical events often show up in energy bills months later.

What this means for businesses

For businesses with energy contracts approaching renewal, developments like this are worth paying attention to.

Energy markets can sit quietly for weeks and then move very quickly if tensions escalate or supply routes are disrupted.

Waiting until the final weeks before renewal leaves businesses exposed to whatever the market happens to be doing at that moment.

A more sensible approach is to review your position early. That allows you to:

• understand the current wholesale market

• monitor price movements

• secure contracts when conditions are favourable

• avoid last-minute decisions under pressure

Even if you decide not to fix prices immediately, having visibility over your options puts you in control.

The key message: stay informed, not alarmed

At the moment, markets are reacting to risk rather than confirmed shortages.

There is no reason for businesses to panic. But ignoring developments entirely can also be a mistake.

Energy procurement works best when it is proactive rather than reactive.

Businesses that understand their renewal timeline and monitor the market are always in the strongest position.

If your energy contract expires in the next 60 days

Now is the right time to review your position.

At Jigsaw Management Consultancy, we help businesses understand their contracts, assess market conditions, and secure energy agreements without hidden commission structures.

If your gas or electricity contract is due for renewal in the next 60 days, get in touch with us.

We can quickly review:

• your current contract terms

• whether renewal rates are already locked in

• if there are better options available in the market

There is no obligation to change supplier — but knowing your position early can make a meaningful difference to what you pay over the next few years.