Gas prices are up 66% since January. Oil is at $81 and rising. If you're on a variable energy tariff, you're fully exposed in real time. Here's how to decide whether to fix -- and for how long.
If oil is likely to stay above $80 or go higher, fixing now is probably worth it. Fixed tariffs are already priced above recent variable rates -- you're paying for certainty, not cheapness. The right answer depends on your risk tolerance and how long you want to lock in.
A fixed tariff locks your unit rate for the agreed term. Your bill still varies month to month based on usage, but the price per kWh or per therm stays the same. A variable tariff moves with the wholesale market -- usually with a lag of 1–3 months. On a variable tariff right now, you will feel the full impact of the TTF gas price doubling.
The critical point: fixed tariff rates are set by suppliers using forward prices, not current spot prices. Suppliers buy energy forward and price their fixed deals accordingly. This means a fixed tariff offered today already reflects some of the anticipated continued price rise -- you're not locking in yesterday's cheap price, you're locking in the market's best guess at the next 12 months.
The Hormuz crisis has introduced genuine supply uncertainty that could persist for months. If the situation escalates or drags on, wholesale gas prices could rise significantly further. A 12-month fixed deal gives you a known annual energy bill regardless of what happens geopolitically. For households on tight budgets, that certainty has real financial value beyond the pure cost comparison.
Energy price spikes also tend to be asymmetric -- they go up fast and come down slowly. Even if the crisis resolves, wholesale prices rarely fall back to pre-crisis levels immediately. Suppliers are slow to pass on wholesale price drops to retail customers.
If the situation in the Middle East stabilises faster than expected, oil and gas prices could retreat. You'd be locked into an above-market fixed rate while the variable tariff falls. This happened to many households who fixed at high rates in late 2022 and then watched prices fall through 2023.
Variable tariffs also give you flexibility. If you're planning to move, install a heat pump or make other changes to your energy setup, a fixed tariff with early exit fees could be an expensive constraint.
Fix if: you're on a tight budget and need cost certainty, you believe oil and gas prices will stay elevated or rise further, or your current variable rate has already risen significantly and a competitive fixed deal represents meaningful protection.
Stay variable if: you think the crisis will resolve quickly, you have the financial buffer to absorb further rises, you're planning major home energy changes in the next 12 months, or you can't find a fixed deal without punitive exit fees.
Compromise approach: Fix for 12 months rather than 24. This limits your downside if prices fall while protecting you through the likely period of continued volatility. Avoid 2-year fixes unless the price is sufficiently lower than the 12-month option.
Always check your current tariff's exit fees before switching. Many variable tariffs have no exit fees; some fixed tariffs charge $50–200 to leave early. Compare the total annual cost of the new fixed deal against your current spend -- including any exit fees amortised over the contract period. Use your country's official comparison service (Ofgem/Uswitch in UK, CREG in Belgium, ACM in Netherlands, ACCC in Australia) rather than commercial comparison sites which may not show all options.
This guide provides general information only and does not constitute financial advice. Energy tariff decisions should be based on your personal circumstances, current supplier offers and your own assessment of future price risk. See full disclaimer.
Wholesale price data: TTF, ICE Brent March 2026. Retail tariff information is general guidance only.
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