More than 1.6 million households in the UK are still using heating oil to warm their homes and water. Around three-quarters of these homes are also paying too much each year because they don’t compare suppliers. This lack of circumspection can cost them around £80 extra each year.
These homes rely on heating oil because they’re not connected to the gas grid and so they use oil as it’s a cheaper option than using electricity for heating, especially if they use a supplier like Emooil.com. Their oil is stored in a tank, usually in the garden, and this tank is topped up twice a year or so.
It pays to compare
According to research from a heating oil price comparison site, a third of the UK’s oil-heated households haven’t ever switched supplier and around 15% haven’t compared prices for ten years or more. On average, not switching means that almost 800,000 homes are overpaying to the tune of £80 a year.
It also pays to shop ahead
Ordering oil in the summer is the best way to keep down oil prices. Consumers who order well in advance – in the middle of the summer is the best time, unsurprisingly – pay an average of 38.8 pence per litre. Leaving it until the leaves start to fall in autumn means the average price per litre goes up to 40.2 pence per litre, which comes out as an additional £30 on the order.
In recent years the overall price of oil has fallen steadily (and somewhat dramatically) – to around two-thirds of what they were in 2013 – but since the start of 2016 they’ve begun another upwards climb.
A few years ago, heating oil cost a lot more than mains gas, but the falls in price brought the cost much closer to that of gas. The average home that uses heating oil will pay between £400 and £500 a year for it, which is around the same as mains gas.
Oil does tend to fluctuate more than mains gas
It’s something of a double-edged sword, but the prices of home heating oil can vary widely, which can work for customers or against them, depending on the timing. The price of a litre of kerosene in July 2016 was 33 pence, but in July 2017 it had risen to 38 pence.
The fluctuations are usually due to the changes in the prices in crude oil, which itself depends on the political and economic situation in the world at the time, as well as the weather and global production levels. When the prices of crude oil rise, the effects are felt all the way down to the household level.
The prices also vary according to region and season – remote areas will pay more for delivery and everyone will pay less during the summer months because demand is lower.
One of the reasons for the slump in prices is the worldwide oversupply, however, some adverse weather events like Hurricanes Harvey and Irma have led to fluctuations.
One thing is for certain, however; the next few weeks will see a rise in oil prices as the weather gets colder, so now is the time to look for a cheap supplier and put that winter order in!
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