How to compare and switch heating oil

What is heating oil and how is it different to gas?

Unlike homes that use mains gas from the grid and have their gas supply more or less “on tap,” heating oil must be purchased directly for delivery to the home in bulk and stored in a tank.

The primary heating oil for UK homes is kerosene (as opposed to red diesel, which is used for commercial purposes and is generally more expensive).

This kerosene heating oil can come in two grades, premium and standard, which are priced accordingly. The premium heating oil has chemicals added to it designed to improve your boiler’s efficiency and cut down on sludge build-up in the supply tank — similar to premium petrol for your car.

How much does it cost to heat my home with heating oil?

Just like mains gas prices, heating oil prices can — and will — fluctuate with the market.

However, unlike a mains gas user, a heating oil user will feel this impact more directly as they are purchasing the oil in real time versus buying it from an energy supplier who has purchased their energy well ahead of when the gas itself gets used.

There are several factors that impact heating oil prices and your ability to get the cheapest heating oil, including:

• Crude oil prices

• Refining costs

• Distribution and delivery costs

• Increase in demand

• VAT rates

• Weather conditions

• Currency exchange rates.

Average cost of heating oil in the UK

This chart from heating oil comparison site BoilerJuice tracks the cost per litre of heating oil from January 2021 to January 2024. We can see here how the wider wholesale energy market issues that began in September 2021 have affected the cost of heating oil, with a significant peak in March 2022. Prices have reduced since then, but are starting to climb again.

How do I find a home heating oil supplier? Can I compare heating oil prices?

Thankfully, there are quite a few heating oil suppliers that you can purchase kerosene from, meaning competition should be alive and well.

Homes using heating oil should consider not just price when choosing a supplier, but also review their customer service reputation.

When it comes to comparing heating oil suppliers, there are comparison sites that do this for you, saving you the time and effort it takes to call each supplier individually to compare prices per litre.

Heating oil comparison sites like BoilerJuice will do your haggling for you, and can even group local orders together to get a greater bulk discount.