Energy companies have been cautioned against taking advantage of businesses amid the escalating crisis in the Middle East that is pushing prices higher.

Regulator Ofgem and Energy Secretary Ed Miliband have issued a directive to business suppliers, emphasizing the need for “maximum flexibility” in contracts for small firms. Miliband stressed the importance of pricing that is “fair, transparent, and fully justifiable.”

A joint letter from Miliband and Ofgem’s interim CEO Tim Jarvis calls for a “fair and supportive approach” with transparent contracts for business suppliers. Additionally, the government plans to introduce regulations through the Energy Independence Bill to oversee energy brokers and price comparison websites.

The disruption of the crucial Strait of Hormuz shipping route for oil and gas, coupled with Iranian attacks on Gulf infrastructure, has caused a surge in global prices.

The benchmark Brent crude price closed at 108.21 dollars per barrel in London trading on Wednesday, significantly up from the 73.08 dollars recorded on February 27, prior to the US-Israeli strikes on Iran that sparked the conflict.

Miliband affirmed the government’s commitment to protecting households through the energy price cap and taking action against exploitative practices in the fuel market. He highlighted the government’s efforts to ensure small businesses receive fair energy deals, stating that clear expectations have been set for business energy suppliers to treat small business customers fairly, including brokers who assist in negotiating energy contracts.

“To prevent unfair practices, the upcoming Energy Independence Bill will introduce new regulations for third-party intermediaries like energy brokers and price comparison websites to safeguard small businesses from harmful practices such as mis-selling and opaque pricing,” said Miliband.

Ofgem will oversee the market, with the authority to establish rules, monitor market activities, conduct investigations, and enforce compliance with the regulations.