The Government has been urged to take steps to introduce regulation of oil prices amid a claim that companies are “profiteering” at the expense of the most vulnerable in society battling the cold.
The urgent call comes from a consumer watchdog as the price of home heating oil — which is used by almost 500,000 households in Northern Ireland — is progressively rising.
According to recent figures, the average price of 900 litres of oil has risen by around £25 in a month as Northern Ireland is caught in the grip of the coldest spell in a generation. According to the Consumer Council in Northern Ireland, the average price of 900 litres in Northern Ireland is £383.73; on December 2, 2009 it was £358.78.
Consumer experts say that more than 70% of people in Northern Ireland heat their homes with oil but is believed that up to half cannot afford to as the current cold weather shows no sign of letting up.
And John French, head of energy at the Consumer Council, said with temperatures continuing to go below freezing the current increase in home heating oil costs couldn’t have come at a worse time.
“It is believed that around one in two households in Northern Ireland currently cannot afford to keep their homes adequately warm at a reasonable cost,” he said.
Mr French said it is these households who are struggling financially that have to frequently buy lower quantities of oil including emergency drums which are more expensive.
Current figures show an average 20-litre emergency drum costs £15.98 — which equals 79.9p per litre.
This compares to 900 litres of
oil, currently costing on average £383.73, which works out at 42.6p per litre.
Mr French added: “The Consumer Council wants to see open and transparent pricing when it comes to home heating oil.
“We believe it is time to consider if the oil industry should be regulated to protect the consumer and how they can fairly contribute to tackling fuel poverty in Northern Ireland.”
Bill Carson, chairman of the Age Sector Platform, a group that lobbies for the rights of elderly people, backed the call for a form of regulation. He added: “What I believe we are seeing is profiteering at the expense of ordinary people.”
The freezing conditions have led to the Department for Social Development announcing a third cold weather payment.
However, oil industry experts say calls for regulation are “unfounded”.
They said the rise is due to the expectation of global economic recovery which has caused greater volatility in oil markets and the colder weather which has increased demand.
David Blevings, spokesman for the NI Oil Federation, said: “Claims for regulation are unfounded, the Regulator and DETI officials have looked at this sector and realised that commercial competition is alive and well.
“The wholesale oil market moves daily and distributors have no control over increasing prices and must respond to market forces.”
He added local oil consumers have benefited from a drop of almost 40% in retail home heating oil since the peak of almost 60p per litre in July 2008.