Energy bills are expected to fall by the equivalent of more than £300 a year this spring after a drop in wholesale gas prices, helping households struggling with the cost of living crisis.

Cornwall Insight, a respected industry consultant, has forecast that average bills will fall by 16% on the previous quarter, and could reach their lowest since Russia’s invasion of Ukraine.

The forecaster predicts that the industry price cap, representing the average annual bill for a typical household in Great Britain, will fall from its current level of £1,928 set at the start of this month by £308 to hit £1,620 from April – £40 lower than it had forecast in December.

Analysts had feared that tensions in the Red Sea, where Houthi rebels have attacked vessels and upended the global shipping industry, would push up wholesale oil prices and feed through to household bills.

However, oil price moves have been relatively muted while European gas stocks have been higher than expected during a relatively mild winter, leading to a fall in price since November.

Cornwall Insight expects prices to remain relatively low throughout 2024 compared with the previous two years – falling to £1,497 a year for a typical annual bill from July, before a small rise to £1,541 from October.

The forecasts will come as a welcome relief for Britons still facing higher outgoings on everything from food to water compared with historic averages, as inflation rates remain high.

Energy bills began to rise sharply in 2021, before the fallout from the start of the conflict in Ukraine the following year pushed up wholesale gas prices further and forced the government to intervene, subsidising bills in an attempt to limit the cost to a typical household to £2,500.

Cornwall Insight said supplies of liquified natural gas to Europe had not been as disrupted as feared by the Red Sea issues, while the UK was “well supplied” with gas from the US, which has played a greater role in meeting demand since the outbreak of war in Ukraine. Low gas prices in Asia, mild weather and strong availability of gas supplies in Asia had also helped, it said.

Craig Lowrey, a principal consultant at Cornwall Insight, said: “Concerns that events in the Red Sea would lead to a spike in energy bills have so far proved premature, and households can breathe a sigh of relief that prices are still forecast to fall.

“Healthy energy stocks and a positive supply outlook are keeping the wholesale market stable. If this continues, we could see energy costs hitting their lowest since the Russian invasion of Ukraine.”

On Monday, the wholesale gas price for delivery next month fell 4% to 65p a therm.

However, Lowrey cautioned that “a full return to pre-crisis energy bills isn’t on the horizon” as the consequences of diverting away from sourcing from Russia, and geopolitical tensions, continue to weigh heavily on the market.

Richard Neudegg, the director of regulation at the price comparison site Uswitch, said: “The prospect of the price cap falling further than expected in April is positive, but it’s little comfort for households struggling through the coldest time of year with high energy bills.”

Neudegg called on the energy regulator, Ofgem, to encourage suppliers to bring back competitive, cheaper fixed price deals.