Around one-and-a-half million people across the UK depend on heating oil rather than mains gas for warmth, with the vast majority living in rural areas where alternatives are scarce. As winter approaches, many are confronting sharply higher fuel bills that force difficult choices between heating their homes and other essential expenses.
The heating oil market operates without the regulatory oversight applied to gas and electricity, meaning global price movements translate directly into customer costs. Middle East tensions and the ongoing conflict in Ukraine have both disrupted supply chains, pushing prices upward at a pace that leaves households and small businesses struggling to adapt.
Before March, prices had remained relatively stable at around 60 pence per litre. When conflict erupted in the region that month, prices jumped to a peak of 134 pence per litre. Although they have since retreated, they remain elevated at 111 pence per litre according to price comparison site Boiler Juice. According to the Rural Services Network, heating oil has risen approximately 74 per cent over seven months, with a 1,000-litre delivery now costing more than £400 above its February price.
A typical 500-litre tank, which most households require, now costs around £550 to fill—a dramatic increase from the £300 many paid just a year ago. For pensioners and those on fixed incomes, the financial burden is acute.
How households and businesses are coping
Peter Mason, a retired resident of Minety in north Wiltshire, described the impact starkly.
I'm getting toward the end of the tank and need to top up for winter... it will be over £550,he said, adding that
it was about £300 to fill up - it is horrendous.He explained that
the price goes up and down. It can vary plus or minus £50 but it has never been as high as it is today.For Mason, the rising cost means
I'll have to eek out what I spent my money on. I'm retired, its not like I can change jobs. I have to be really careful and pull money out of savings.
The strain extends beyond domestic heating. Dylan Williams, a 51-year-old who operates a van-driving business across the Forest of Dean, Stroud and South Gloucestershire, has seen his fuel costs climb from £120 to £130 for a full tank at the start of the year to £160 today—the highest in his three years running the company.
It's ever increasing, ever worrying - keeping an eye on the news, keeping an eye on the diesel prices,he said, noting that even fuel cards offer little relief from the upward pressure.
Organisations serving rural communities face similar pressures. Yvette Farrell, volunteer director for Dean Forest Kitchen, which prepares and delivers fresh meals daily to isolated clients across the Forest of Dean, warned that rising fuel costs threaten the service's viability.
It's impacted us a lot because we work on a not-for-profit scenario so there is not a lot of wiggle room when it comes to increase in any expenses.She stressed that
the cost of fuel is really, really hitting the business hard and we're having to do our best to still keep going to our clients who are spread across a very rural area with no public transport.The organisation may have to increase prices, though
there's not going to be much choice in the future.
Tristan Holland, company director at TLC Support Service, manages a small team of community care workers who travel around Wotton-under-Edge and Dursley. The company pays staff 55 pence per business mile to cover vehicle costs.
We had an increase in our fees back at the start of the year, just kind of taking into account all the extras that were coming in this year but even that does make it tight.He noted that
everything has risen - the cost of the fuel, the training, even the uniforms that we purchased. Everything has gone up and so we try to keep our services as affordable as we possibly can but there has to be a profit or else we just can't carry on going.
Why are prices so volatile?
The unregulated nature of the heating oil market means prices respond immediately to global events. According to the Competition and Markets Authority, wholesale costs accounted for 83 per cent of the retail price increase in March, with supplier operating costs responsible for a further 6 per cent. The CMA's market study found that prices peaked 92 per cent above February levels, with a typical 500-litre order costing about £200 more in March than in February.
Before the conflict, heating oil prices already varied significantly by region. According to government analysis, average prices stood at around 67 pence per litre in Scotland, 62 pence in Wales and England, and 57 pence in Northern Ireland. The regional variation reflects differences in distribution distances and local market conditions.
Demand for heating oil is inherently seasonal, rising sharply in winter and falling in summer. This pattern affects sales volumes, retail prices and distributor profits, making the market particularly vulnerable to supply disruptions during the colder months when demand peaks.
Could prices fall?
Any prospect of price relief depends on geopolitical developments. Analysts suggest that a peace agreement between the United States and Iran could ease wholesale costs. Richard Willan, who runs the Nadder Oil Buying Club in Wiltshire—a bulk-buying scheme where more than 1,000 residents purchase together to secure better rates—said the community is watching political developments closely.
We are watching to see what happens with (Donald) Trump in the mid-term elections in America, that might change things again,he said.
However, rural residents remain vulnerable to price shocks beyond their control. The Competition and Markets Authority concluded that heating oil customers in remote areas face particular exposure. CMA chief executive Sarah Cardell stated:
Stronger safeguards are needed - including regulatory oversight and better support for vulnerable consumers as well as communities living in areas of the UK that are particularly exposed to higher and more volatile prices.
What support is available?
As prices remain above 100 pence per litre and temperatures fall, campaigners are calling for targeted government intervention. According to Action in Rural Communities England, thousands of rural people risk becoming casualties of the energy crisis without specific support. The organisation is urging the government to remove VAT on heating oil and liquefied petroleum gas for six months as part of the budget.
Locally-run schemes offer some relief. The Surviving Winter campaign, run by a coalition of charities in Wiltshire, supported more than 3,000 people last year with heating costs. The Department for Environment and Net Zero said it is helping thousands of households on heating oil switch to cleaner alternatives through grants worth £9,000, alongside a dedicated resilience fund for areas with higher rates of oil heating. A spokesperson urged eligible households to apply.
What happens next
The Fuel Distribution Association has advised customers to prepare for periods of increased demand, severe weather and possible delivery delays as winter intensifies. With heating oil demand expected to surge in the coming months, early purchasing—despite high prices—has become a necessity for many households seeking to avoid even steeper costs or potential supply shortages.
