In a matter of days, an overseas conflict sent wholesale gas prices up 50%, wiped dozens of fixed tariffs off the market, and pushed oil past $100 a barrel. If your business energy strategy was not already a priority, it should be now.
What Happened?
At the end of February 2026, US and Israeli military strikes on Iran triggered one of the most significant energy market shocks since Russia invaded Ukraine in 2022. The conflict effectively closed the Strait of Hormuz, the waterway through which roughly 20% of the world’s oil and gas normally passes. Shortly after, QatarEnergy halted liquefied natural gas production, removing another major source of supply from global markets.
The result was swift and severe, oil prices surged past $100 a barrel, wholesale gas prices rose by around 50%. The International Energy Agency responded by releasing a record 400 million barrels from strategic reserves in an attempt to stabilise markets.
For households, the Ofgem price cap provides some temporary protection until July, for businesses, there is no such shield, commercial operators were hit immediately.
Within days of the conflict escalating, the number of fixed price business energy tariffs available in the UK fell from 38 to just 15. Major suppliers including British Gas, OVO and Scottish Energy withdrew their fixed tariffs entirely.
This Is Not a One Off
It would be easy to treat this as an exceptional, unpredictable event, but the honest assessment is that it is becoming a pattern.
The 2022 Russian invasion of Ukraine sent energy prices to record highs and triggered a national cost of living crisis. Before that, COVID disrupted global supply chains and exposed how fragile energy markets could be. Now the Iran conflict. Each time, the businesses most exposed were those most dependent on the grid and on wholesale fossil fuel markets.
As Oxford University’s energy experts noted this week, the crisis reiterates a simple argument: if the UK were less reliant on oil and gas today, the economic damage would be significantly smaller. That observation applies equally at a national level and at the level of an individual business.
The Government’s Response Tells You Where This Is Going
Energy Secretary Ed Miliband’s response to the crisis was telling.
Rather than calling for more North Sea drilling or importing more gas, he announced an accelerated clean energy programme, including bringing forward the next renewables auction to July 2026, just months after the record breaking AR7 round in January.
His reasoning was direct: there can be no energy security while the UK remains dependent on volatile fossil fuel markets. The fastest route off that dependency is clean, homegrown power.
The government’s direction is clear and it is not changing, but policy timelines are measured in years. For businesses facing energy cost pressures right now, waiting for the grid to decarbonise is not a strategy.
The businesses that navigated the 2022 crisis best were those that had already reduced consumption, diversified their energy sources, or invested in on site generation. The same is true today.
What This Means for Your Business Specifically
The immediate impact of the Iran crisis falls hardest on businesses that are fully exposed to wholesale markets, particularly those on variable tariffs or those whose fixed deals are coming up for renewal. With fewer tariffs available and prices elevated, the options are limited and expensive.
The deeper issue is even more structural. Every time a geopolitical event sends energy prices spiking, businesses without any form of energy independence absorb the full impact. Every unit of electricity you generate yourself, or avoid consuming entirely, is a unit that is completely insulated from whatever is happening in the Middle East, in Moscow, or in any other volatile part of the world.
There are three practical responses available to commercial operators right now:
The Bigger Point
Each energy crisis of the last five years has followed the same script: An external shock disrupts global supply, wholesale prices spike, businesses without protection absorb the cost, governments respond by accelerating the transition away from fossil fuels.
The Iran conflict is the third major iteration of this cycle in four years, it will not be the last. The businesses that treat each crisis as a one off event and return to business as usual in between will keep absorbing these shocks. The businesses that use each crisis as a prompt to reduce their exposure will progressively insulate themselves from the next one.
Energy independence is no longer just a sustainability talking point, it is a financial resilience strategy.
Find out how exposed your sites are and what you can do about it, book a free 15 minute assessment with the Powerhub Solutions team here.
