Government Stance on Energy Firm Profiteering
The government has declared it "will not tolerate" energy companies profiting excessively from the rising oil prices, with the competition watchdog prepared to intervene to prevent petrol price "rip-offs," Energy Secretary Ed Miliband told the BBC.
The surge in oil prices, driven by the conflict in the Middle East, has raised widespread concerns about its impact on household bills, particularly for those dependent on heating oil, who are already facing significantly higher costs. Petrol prices at the pump have also increased.
Miliband did not exclude the possibility of direct financial support or extending the freeze on fuel duty should the conflict persist.
Political Reactions and Net Zero Policy
Shadow Transport Secretary Richard Holden criticized Chancellor Rachel Reeves for not taking sufficient action to alleviate the cost of living pressures.
Miliband defended the government's commitment to net zero policies, emphasizing the need to move away from reliance on fossil fuels. He stated,
"We've got to have clean, homegrown power that we control. That's the biggest long-term lesson of this crisis."
Some energy companies and industrialists have advocated for increased exploration and production in the North Sea as a response to the current oil price shock.
Miliband countered this, asserting that the government's current strategy—continuing production from existing fields without permitting new exploration—is the correct approach for both energy security and climate change mitigation.
"New exploration licences in the North Sea, which some people are calling for, will not take a penny off people's bills," he said.
Energy Security and Market Oversight
The government faces pressure to act on rising energy bills in both the short and long term, especially as the effective embargo in the Straits of Hormuz—a critical energy supply route—remains in place.
Energy Minister Michael Shanks told the BBC,
"The public expects us to take this really seriously."
Miliband announced a fast-track process for constructing new nuclear power stations, which have historically experienced delays, escalating costs, and bureaucratic obstacles.
However, more immediate measures may be necessary to address rising petrol and heating oil prices.
Chancellor Rachel Reeves and Miliband are scheduled to meet petrol retailers later on Friday to convey that the Competition and Markets Authority (CMA) is on "high alert" for any unjustified price increases.
Earlier in the week, the Chancellor highlighted the disparity in petrol prices, ranging from £1.27 to £1.80 per litre across different forecourts.
Miliband expressed concern about market behaviors and confirmed that he and the Chancellor met with the CMA earlier in the week to specifically discuss heating oil and motor fuel prices.
"They're looking at the situation carefully. They are willing to intervene," he said.
"We will not tolerate unfair practices, price gouging."
The CMA possesses various enforcement powers, including the ability to impose fines on companies.
"It'd be completely unacceptable for anyone to use this crisis, to rip people off," Miliband stated. "And we will fight people's corner to stop that happening."
Potential Government Support and Fuel Duty Review
Whether the government will implement further support for households depends on the duration of the conflict, Miliband added.
He highlighted the Chancellor's previous readiness to intervene, referencing measures in the November Budget aimed at easing energy bills with additional funds targeted at vulnerable households.
Fuel duty, currently frozen, is scheduled to increase in September, but Miliband confirmed this is under review.
Holden criticized Reeves, saying,
"She could cancel the fuel duty rise, she could cut the taxes piled on to energy, she could stop piling costs on to the price of fuel - but she isn't doing anything because she doesn't have the backbone."
"A 5p-per-litre duty increase at the pump will hit commuters, families, and small businesses already under pressure from the cost of living and Labour's tax hikes," he added.
"The latest developments in the Middle East make it even more important that the chancellor thinks again," the Conservative shadow minister said.
Economic Context
Official figures released on Friday showed that the UK economy did not grow in January.
When asked if the government had weakened the economy prior to the war, Shanks responded,
"I don't accept that at all... and we're also doing everything we can to get the economy moving."
