Getting the best heating oil prices
Heating oil prices are subject to change, depending on a number of factors. But you can still save money – if you know how.
Prices for heating oil, including sudden peaks and troughs, are largely affected by the price of crude oil. This can fluctuate depending on the weather, political unrest and global production. Recently they have been affected by the collapse in demand owing to the coronavirus pandemic.
Local weather can affect the demand for heating oil, which in turn affects the price. This includes prices for delivery, too, depending on how far you are from a supplier.
How much does a litre of heating oil cost?
The average price per litre for kerosene was around 27p in October 2020* – summer and autumn of 2020 have seen the lowest heating oil prices for more than four years, dropping from 36p per litre at the start of the year.
Are heating oil prices going up?
Heating oil prices have gone up and down over the last five years or so. Having generally followed an upward trend between January 2016 and April 2018, they then hovered around the 50p per litre mark (on average) until January 2020.
They then dropped suddenly in spring and summer 2020 and, as of October 2020, the average price for heating oil was half what it cost two years before, in October 2018.
This is the result of falling oil prices across the world during the coronavirus pandemic, so it is tricky to predict what will happen to prices in future.
In previous years, we've seen prices fall in summer, though this isn't something to rely on.
No matter what happens to the price of heating oil, there are still various things you can do to keep the costs down. Read on to discover the best time to buy heating oil, and what you can do to make sure you get the best price.
Compare heating oil prices
Heating oil prices vary across the UK and between companies. So compare as many quotes as possible from different companies, and do so regularly so you can monitor when and where you can get the best prices.
You can get free estimates from online companies, such as Boiler Juice and Heating Oil. But these types of firm provide only guide prices; for precise figures it's best to check with as many local and online companies as possible once you've decided to buy.
It's a good idea to do a quick online search for reviews or complaints about a company before you buy.
If you're buying on the internet, look out for sites with premium SSL certificates (the small padlock icon in the top corner of your website bar, next to the web address, like in the image below). As these cost money, they're less likely to be used by a fraudster. Plus it means the site's secure.
If you're not sure about a supplier, contact the UKIFDA at email@example.com. It's also worth looking for suppliers with FPS accreditation, as this means they will have had to sign up to its code of practice.
Get the best deal on heating oil
The tips below can help you make sure you don't pay more than you need to for heating oil.
1 Buy ahead of time
Where possible, try to plan and buy ahead to save yourself from paying more. The prices quoted to us are for standard deliveries. If you need it more quickly, express or emergency deliveries are often available, but at a premium price.
If you can plan ahead, waiting longer will cost you less.
2 Buy heating oil in summer
Prices for heating oil tend to be lower in the summer, as demand is a lot lower. 2020's dramatic drop during the summer may not be typical, because of the impact of the coronavirus pandemic on oil prices. But to take a less exceptional year, the average price for heating oil dropped from 43p a litre in April 2017 to 38p in July. In 2019, prices fluctuated little but were at their cheapest in April.
However, it's wise to keep an eye on the market in general, as it's not always cheaper in summer, and can fluctuate. For example, in 2018 it was cheaper in winter than in spring and summer:
- 48p in January 2018
- 52p in April and July 2018
Buying outside of the winter season means you will avoid potential delivery problems in bad weather. On average, people buy around two or three times a year – depending on the size of their tank and energy use – and order between 1,000 and 2,000 litres.
No matter when you order, it's important to keep an eye on your oil-tank gauge. Don't let it get too low before you order – less than a quarter full, for example – especially in winter.
3 Bulk buy heating oil
The size of your tank will affect how much heating oil you can store, and therefore how much you can order in one go. Generally speaking, the more you order, the cheaper it will be. The average size of domestic heating oil tanks ranges between 1,000 and 3,500 litres (although larger ones are used commercially).
It’s worth noting that a heating oil tank should only be filled up to around 80-90% of its capacity to avoid spillage.
If your tank doesn't have a large capacity, joining a heating oil club (also called a heating oil buying group) free of charge is a good way to buy cheaper heating oil. This is because your order will be clubbed together with others in your area.
The Citizens Advice Bureau estimates that buying this way can knock 10% off your heating oil bills.
Besides searching online for heating oil clubs in your area, it’s also worth looking at websites that combine regional oil clubs together to increase orders even further, such as The Oil-Club.
4 Start a heating oil club
Alternatively, you could start your own oil club with neighbours, friends and family. But bear in mind how close together you live, and whether the volume you wish to order is likely to exceed what a lorry can carry (18-20,000 litres). Above this, you’re less likely to get a further discount, as the supplier will need a second vehicle.
You'll need to appoint a co-ordinator to call the oil companies and negotiate a price depending on the size of the group and time of year you order. You can use local services, such as the post office, village hall, or local social media sites, to advertise for more members.
5 Negotiate the price
Whether buying in bulk with a club or on your own, don't be afraid to negotiate. The more quotes you have, the more information you will have to bargain with.
Even if you're happy with your current supplier, see if you can find a cheaper price – then talk to your usual supplier, as it may be able to match it.
6 Be careful how you pay
When you set up payment for your heating oil, check carefully for the following:
- Does the company charge extra fees for paying by credit card?
- Will paying by direct debit can lock you into a contract?
A contract isn't necessarily a bad thing; in some agreements the supplier will also monitor the amount of heating oil in your tank and automatically arrange to top it up.
On the other hand, being locked into a contract doesn't give you the flexibility to shop around for a better price.
Consider both of these when deciding how to pay for your heating oil.
7 Protect and maintain your tank
Heating oil is pricey, so safeguarding it against theft and leakage can save you money in the long run.
Servicing your heating oil tank and boiler once a year using an Oftec-registered technician will alert you to problems before they get worse, and will protect against more costly faults.
8 Get an efficient oil boiler
The efficiency and age of your boiler will affect how much money you spend, so make sure it's in working order by getting it serviced annually. If you have a very old or inefficient model, getting an upgrade may save you money in the long run.
According to oil industry advice, you could save £200 a year if you change to a modern condensing boiler that has up to 97% efficiency, compared with a model that's more than six years old. But a new oil boiler will cost anywhere between around £1,300 and £3,200, and then between £2,000 and £3,000 for installation.
How to cut your energy bills
As well as getting a good price for heating oil, you can minimise the amount you use (and therefore the money you spend) by cutting your energy costs. Take a look at our full guide on . Options include:
(*Average prices for a litre of kerosene from Sutherland Tables, which collects domestic fuel pricing data from across the UK for each quarter of the year. For example, January figures are an average across November, December and January.)