Analysis: This is a very good time in Northern Ireland to fill up your home heating oil tank

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​Again today I pose that query. And the short answer is clear – it is a very good time.

Below is the longer answer:

Oil in Northern Ireland is at the lowest level it has been since last summer, and that season was itself the cheapest period for oil prices since the Russian invasion of Ukraine, 18 months previously.

My own interest in this matter is simple: for the great bulk of my life I was either living with parents (who sorted bills), in student accommodation, or in rented properties where the bills were shared or the energy was gas.

Only after 2018 did I become owner of an oil-fired property for which bills were my sole responsibility. In the first few years I simply filled the tank when it ran low. I knew oil prices fluctuated but thought: so what? Petrol prices do too and you can’t wait for them to fall if you have to drive.

But two things happened that showed me how variable home heating oil prices can be. The first was covid, which sent prices so low in 2020 that there was more supply than places to put it. Anyone who had so much as a large oil tank to fill could have saved high hundreds of pounds by filling it then compared to the year before, 2019.

The second was the 2022 Russian invasion, which did the reverse: it sent prices sky high. The war in the Middle East last year threatened to push prices up further (and did for a while, before they fell back again).

So I came to understand why there was so much interest in average oil prices and for years we published them daily on our pages (we no longer do because prices are readily available online).

When I look back at those home heating oil price listings, say, 10 or 15 years ago I see that oil prices fluctuated significantly even then. For example, a decade ago in May 2014 900 litres of oil was priced on average about £480. Two years earlier, in May 2012, it cost almost £100 more than that, at around £560. Which, as it happens, is roughly the price of 900 litres of oil today, costing an average £580 last week according to the NI Consumer Council (500 litres was £327).

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But in fact oil is now cheaper in real terms than in 2012 and 2014. Inflation since then means the average 900 litre prices from those years, 2012 and 2014, are in today’s money equivalent to £770 and £640 respectively.

I have written previously of how I got badly stung buying oil in December 2022, when I had relatives coming to stay over the holiday and, while I thought I had enough to last until January, I suddenly feared the humiliation of running out over Christmas, and bought more at an almost peak rate of £1 a litre.

Since then I have devised a rough guide to oil price ranges:

• A price of £1 a litre or more (£900+ for 900 ltrs; £500+ for 500l) is horrific

• 80p a litre (£720 for 900 ltrs; £400 for 500l) is pricey, but within the bounds of the new conflict-era normal

• 60p or less (£540 for 900l; £300 for 500l) is cheap

We are almost at that level now (circa 65p a litre). Last summer oil was 55p a litre from May to July. In the early spring I wrote that it was a good time to buy, but foolishly failed to do so myself. Then in August prices began to climb up towards 80p a litre.

After being stung in 2022, I have mostly bought oil in 500-litre batches at times when prices seem reasonable. Buying small amounts is a way of hedging, to avoid having to fill up a tank after a sudden spike in prices. But I have just bought a larger amount, 900 litres, because of my confidence that this is a good time to buy. Prices might go lower still, closer to last summer’s level, but waiting for such a drop runs a risk of a rapid rise.

Oil is surprisingly cheap given that Ukraine is still at war, now the Middle East too.

David Blevings of the NI Oil Federation says: “Oil prices are falling on the hope of progress in the Gaza peace talks which reduces the ‘fear factor premium’ which traders had built in reflecting the potential for a major upset in the oils market in the Middle east. We have also seen an increase in crude oil stocks which is negative for prices as supply is more readily available. According to the Consumer Council website today’s average price for 900 litres is c. £580 and this compares to over £700 back in September. This is excellent news for oil users and to be welcomed.”

• Ben Lowry is News Letter editor