Home heating oil only half the price in Northern Ireland it was 12 months ago

The fact that home heating oil in Northern Ireland is now only half what it was a year ago will come as welcome relief to householders at this time, the Consumer Council has said.
By Philip Bradfield
Published 26th Sep 2020, 06:30 BST
Updated 26th Sep 2020, 08:56 BST
Home heating oil in Northern Ireland is only half the price it was a year ago, as confirmed in this graph from www.Boilerjuice.comHome heating oil in Northern Ireland is only half the price it was a year ago, as confirmed in this graph from www.Boilerjuice.com
Home heating oil in Northern Ireland is only half the price it was a year ago, as confirmed in this graph from www.Boilerjuice.com

Michael Legg, Head of Energy Policy at The Consumer Council, said its research shows that the average price for 500 litres in Northern Ireland this week is £135, which is 50% cheaper compared to this time last year.

“The lower home heating oil prices will provide welcome relief for consumers, especially considering the negative effects of COVID-19 on household income and with the winter months fast approaching,” Mr Legg told the News Letter.

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“While this is positive news, it is of course, disappointing to see that petrol prices have not mirrored the recent drop in home heating oil prices.”

Mr Legg suggested that it was possible that forecourt petrol and diesel prices have not reflected the same drop as heating oil prices because 70% of of forecourt prices are tax - fuel duty and VAT.

Another reason, he said, could be that petrol retailers may be trying to maintain their income by keeping forecourt prices high, as demand for car usage dropped so dramatically during lockdown and is only gradually picking up again.

In May the News Letter reported home heating oil was even cheaper than now, reportedly down to 2009 levels, at £123 for 500litres.

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At that time The Consumer Council told the News Letter that forecourt petrol prices and piped gas had also seen significant decreases in NI.

As well as an oil price war between Saudi Arabia and Russia in March, the global coronavirus pandemic had shut factories and put the brakes on road and air traffic globally, slashing global demand for oil.

That meant that Brent Crude oil prices - the benchmark used by Europe - had fallen from $70 a barrel in March to just above $20 - its lowest level since 2002.

Luke Bosdet of AA Public Affairs also noted that the backdrop to the lower heating oil prices is that Brent Crude oil prices have dropped significantly in the past twelve months, from $62 to $42, dipping to only $16 in April.

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He said that forecourt fuel prices have not reflected this to the same extent.

“In Northern Ireland over the past three years we have seen forecourt prices being some of the most expensive in the UK to some of the cheapest.”

He suggested this could be due to competition driven by Asda and close scrutiny by the NI Consumer Council.

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Related topics:Northern IrelandVATNews Letter