Reeves to look at how to help households with heating oil bills

Chancellor Rachel Reeves has committed to investigating ways to support households that rely on heating oil, acknowledging the particular difficulties they face amid the ongoing conflict between the US and Israel with Iran. This announcement comes in response to soaring global oil prices, which surged to nearly $120 a barrel on Monday—a peak not seen in four years—fueled by fears that the war could severely disrupt supply chains.

Many households that heat their homes with oil keep their supply in tanks outside their properties, making them especially vulnerable to climbing costs. Unlike gas and electricity, which have regulated price caps through Ofgem, heating oil does not benefit from any such protective measures. In light of this, Reeves has organized discussions between Treasury officials and MPs representing rural areas and Northern Ireland to explore potential supports for those affected.

Energy Secretary Ed Miliband highlighted the significant increase in heating oil prices during talks with the UK and Ireland Fuel Distributors Association, expressing concern over the impact on both households and businesses. Statistics reveal that only a small percentage of homes in England and Wales (3%) and Scotland (5%) rely solely on heating oil. However, Northern Ireland stands out, with nearly two-thirds of homes using oil for heating—the highest proportion in the UK. According to the Consumer Council, there are approximately 500,000 homes in Northern Ireland dependent on heating oil, compared with around 284,000 that use natural gas.

The effect of rising prices is already being felt at a personal level. Fran Barrett, a teacher living in a Cheshire village without access to the gas network, reported that her heating oil costs more than doubled within days after the conflict began. Initially quoted £314 for 500 litres, the price jumped to £653 shortly afterward, and she currently cannot find a supplier willing to deliver to her area. Barrett is conserving the remaining oil in her tank for hot water only, having switched off the heating entirely.

Reeves addressed members of Parliament to stress her awareness of these challenges, saying, “I recognise that households who use heating oil face unique challenges, and so I have asked the Financial Secretary to the Treasury to lead discussions with officials and with rural and Northern Irish MPs to explore further action that we can take.”

Meanwhile, the Competition and Markets Authority (CMA) has cautioned that the conflict is applying upward pressure on heating oil prices. Emma Cochrane, acting executive director for consumer protection, warned suppliers against profiteering by increasing prices unfairly on pre-existing orders. “We won’t hesitate to take action if we suspect that consumer or competition law is being broken,” she stated. Reeves has also tasked the CMA with closely monitoring prices for essentials, including road fuel and heating oil, to ensure consumers are protected during this volatile period

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