UK wholesale gas prices have pushed past 200p a therm for the first time since late 2022, driven by disruption in the Middle East that’s cut into global supply. For households, that shows up as a roughly 4% rise in Ofgem’s price cap from October. For businesses, who aren’t protected by that cap, it’s landed harder: business gas contracts for this winter and next are already up around 15% compared to earlier pricing, and the driver, ongoing volatility tied to the Gulf, isn’t something that resolves on a predictable timeline.

Why business energy moves faster and further than household bills

Unlike domestic customers, business energy isn’t covered by Ofgem’s price cap, so commercial gas and electricity contracts track wholesale market movements far more directly and far faster. When wholesale prices spike the way they have this month, businesses renewing or negotiating a contract right now are the ones who feel it first, often before the wider economic story has even made the headlines. If your current fixed-rate contract is due for renewal over the next few months, you’re renewing directly into this spike, not into the calmer pricing of a few months ago.

This matters most for businesses with genuine energy exposure: manufacturing, hospitality, food service, anything running commercial refrigeration, ovens, or heavy equipment. But even a modest office consumes enough gas and electricity that a 15% jump is a real line-item change, not background noise, especially stacked on top of the wage, rent, and compliance cost pressures most SMEs are already managing this year.

Why this spike is different from a normal seasonal rise

Gas prices always firm up heading into winter as demand climbs, so some increase is normal and predictable. What’s different this time is the cause: the disruption is tied to the effective closure of a major shipping route through the Gulf, which has cut off a meaningful share of the oil and gas that would otherwise reach global markets. That’s a supply-side shock driven by an active geopolitical situation, not a routine demand cycle, and supply shocks of this kind don’t resolve on a predictable schedule the way seasonal demand does. Energy analysts have been clear that until shipping through the region normalises, wholesale prices are likely to stay elevated and volatile, which is exactly the environment where locking in a bad renewal rate becomes expensive for a full contract term rather than just a few weeks.

What to actually do before you renew

Don’t let a contract auto-roll onto a supplier’s default “out of contract” rate, which is typically the most expensive option available and exactly where SMEs lose the most money without noticing. If your renewal window is open now, get quotes from more than one supplier rather than accepting the first renewal offer, since business energy pricing varies more between suppliers than most owners expect. Consider whether a longer fixed-term contract makes sense to lock in rates before further Middle East-driven volatility, versus staying flexible if you expect prices to ease; there’s a genuine trade-off here, not an obvious right answer, so it’s worth an actual conversation with a broker rather than a default choice.

It’s also a sensible moment to review your supplier contract terms generally, exit clauses, automatic renewal notice periods, and what happens if you need to switch mid-term. A service like Smallprint can help you check what you’ve actually signed up to before a renewal locks you in for another year at a rate you didn’t fully compare.

The takeaway

Wholesale gas at a near four-year high isn’t a temporary blip tied to one news cycle, it’s flowing straight into business energy contracts renewing right now. If your energy contract is up for renewal this quarter, shop it properly rather than accepting the rollover rate, and check the small print on exit and renewal terms while you’re at it. The businesses that get hit hardest this winter won’t be the ones using the most energy, they’ll be the ones who let a contract renew on autopilot.