The US President's recent tariff wars have seen global markets crash, with steep declines and then partial surges - so could the economic chaos be good news for UK households?
News Levi Winchester and Kieran Isgin Money & Lifestyle writer 04:30, 19 Apr 2025
Martin Lewis has waded in to give his view on the impact of Donald Trump's tariff's on our bills. The founder of MoneySavingExpert.com has shared his insights on whether energy bills are likely to drop in the wake of market turmoil triggered by the US President's "Liberation Day" tariffs.
President Trump's actions sent global markets into a tailspin, with steep declines followed by partial recovery. The US President has recently announced a 90-day pause on some tariffs - but is locked in a dispute with China, which has been slapped with 145% tariffs on all goods.
Martin Lewis explained that the Donald Trump "effect" has led to a decrease in oil and gas prices, which could result in lower energy costs down the line. However, he said prices won't plummet significantly.
The Ofgem energy price cap, which dictates energy costs for millions of households, is influenced by wholesale energy prices. Although wholesale energy prices have fallen by approximately 40%, Martin Lewis noted that this doesn't necessarily mean energy bills will decrease by the same amount.
Article continues below
The price cap is calculated based on average wholesale prices over a three-month assessment period. The next price cap, set to take effect in July, will be determined by average wholesale prices between mid-February and mid-May.
Martin said: "If things continue to go down, and the predictions for the worldwide economy worsen, we could see the prices dropping even further." But he had a warning.
He added: "But remember, because it's a three-month average from February to May that dictates the July price cap, even if it drops a lot now, you've already got nearly two months' worth of data in. It won't have the profound effect you'd think it will."
Martin then shed light on the energy price cap's quarterly review cycle, marking our calendars for updates in July and October. Still, he threw up a caution sign about winter energy bill forecasts, noting: "If prices continue to stay low, then it would be the October price cap, and the following January price cap that would be lower."
He noted: "Now, currently, it is predicted that we'll see another drop of about 3% in October, and then it'll stay about the same in January. But that's really crystal ball gazing."
Martin also talked about fixed deals. The top bargain fix now is about 16% cheaper than the current price cap, nudging ahead of the previous 13% or 14%.
He advises shopping around now and locking your energy rates if possible. Martin urged: "You can still fix now far less than you will pay on the price cap, and less than the price cap is predicted to drop.
Article continues below
"So if the predictions are right, you would be far better going onto MoneySavingExpert's Cheap Energy Club comparison and locking in a fix. But there is an 'if' on predictions; things could change even more. So just have a look at the early exit penalties if you do fix."
For the latest breaking news and stories from across the globe from the Daily Star, sign up for our newsletter by clicking here.
