As temperatures plummet our oil prices keep going up
Temperatures in Northern Ireland may not be going up during this bitter winter — but the price of home heating oil definitely is.
New figures provided by a leading comparison website for the Belfast Telegraph reveal the cost of 900 litres has risen by up to £35 in just seven days.
Sharp increases in excess of £10 were recorded by cheapestoil.co.uk, with industry experts predicting further hikes as weather conditions worsen.
The bad news follows a spike in the price of a barrel of crude oil to $80 (£51), bringing little comfort to householders during the current cold snap.
Amid concerns over the cost of home heating oil — used as a main fuel source by 70% of Ulster homes — Energy Minister Arlene Foster was last month urged to establish a ‘fuel tsar’ to regulate the industry.
And while there is no proven link between cold weather and increased prices — other than the basic economics of supply and demand — consumers are becoming increasingly disconcerted by the lack of regulation in the industry.
Yesterday the Northern Ireland Consumer Council reiterated calls for a fuel champion to ensure cash-strapped householders get open and transparent prices.
“Gas and electricity customers here currently benefit from regulation that develops and enforces best practice and customer service standards,” said John French, Head of Energy.
“The Consumer Council would like to examine whether the same level of protection could be provided to those who rely on oil for their heating.”
Mr French added: “We remain very concerned about the high price of home heating oil and its effect on consumers.”
A snap survey of 10 local suppliers showed all of them have put their prices up between £10 and £35 over the past week.
However, prices slumped by as much as £24 between the end of last month and the middle of February, as the weather became milder.
At Milligan Oil, for example, the cost of 900 litres fell by £23.62 (from 24/01/10 to 17/02/10) before shooting up £30.71 (from 17/02/10 to 24/02/10).
And it’s a trend that is replicated by almost every local oil supplier surveyed by cheapestoil.co.uk.
“Prices for 900 litres have risen sharply, by about £20 for 900 litres, since last Thursday,” said a website spokesman.
“They are currently at £390 — which is £100 more than the same time last year — and they are still rising, with 500 litres costing £225.”
He added: “On this day last month, prices were almost the same as what they are now so it is extremely difficult to predict if prices will come down by much.”
Last February, the cost of home heating oil hit a two-year low when it fell back to 2007 levels and the average price for 900 litres dropped to below £300. At the same time 500 litres was priced at £174.
Figures provided by the Consumer Council show that 900 litres of oil cost £376.41 on December 30, 2009, before jumping to £406.37 on January 11, 2010. By January 24, though, the price had fallen to £376.98, as temperatures began to rise.
Energy price expert Paul Gosling said: “Without effective regulation there is no assurance for consumers that they’re not being ripped off.”
David Blevings, Northern Ireland Oil Federation spokesman, said prices have been rising due to the increasing wholesale price of refined products.
“This is due to the continued cold weather putting increased demand on lower stocks and exchange rate gains from the surging dollar,” he said.
“Unfortunately these factors are beyond the control of the local distributor who has no option but to reflect increasing wholesale costs in retail prices.”