Britain's competition watchdog is reviewing evidence of potential profiteering by heating oil suppliers after a letter from MPs raised concerns about the soaring prices faced by rural households.
The Competition and Markets Authority (CMA) stated it is investigating complaints from consumers who rely on heating oil, following reports existing orders were cancelled and replaced with dramatically higher quotes. The move follows pressure from 50 Conservative MPs, including Conservative leader Kemi Badenoch and Shadow Energy Secretary Claire Coutinho, who warned vulnerable households could be exploited during the current volatility in global oil markets triggered by the Middle East conflict.
Around 1.5 million homes across the UK rely on heating oil, particularly in rural areas without access to the mains gas network. In Northern Ireland, the dependence is even greater, with nearly two-thirds of homes using oil for heating.
Prices have surged since the escalation of the war in the Middle East pushed up global oil costs. Some customers have reported an 81 per cent increase in bills, with many others facing bills that have doubled in a matter of days.
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The CMA said it had been notified of several troubling reports from consumers about their experiences with suppliers. The CMA said an initial review has identified two main issues the regulator is now investigating: existing heating oil orders being cancelled and re-quoted at much higher prices and price increases for automated deliveries triggered when tanks run low.
Sarah Cardell, chief executive of the CMA, said the watchdog was moving quickly to examine the complaints. “We know many households are worried about rising prices as global events push up wholesale oil costs,” she said. “It’s inevitable that some prices will rise, but they should reflect genuine cost pressures. We’ve heard troubling reports from heating oil customers about cancelled orders and sudden price increases – and are moving quickly to get to the bottom of these concerns. As always, we stand by consumers and will make sure they are treated fairly.”
The regulator has begun "urgently" writing to a number of firms, including both direct suppliers and intermediaries, requesting information about their pricing practices. However, the CMA stressed the review is at an early stage and no assumption should be made companies have broken consumer protection law. The outcome will depend on the evidence gathered.
Ms Coutinho first highlighted the issue in a letter to Ed Miliband last Friday as revealed by GB News. She told the People's Channel: “Heating oil is being delivered without a price being quoted. We have called on the CMA to investigate these practices. We want more transparency and fair practices for consumers.”
The CMA said it had been notified of several troubling reports and has 'urgently' written to a number of firms
|GETTY
The Government has also stepped in as concerns mount over the impact on rural households. Energy Secretary Ed Miliband has since written to the chief executive of the UK and Ireland Fuel Distributors Association, warning the sharp rise in prices had caused serious concern. He wrote: "To be clear, our firm expectation is that pricing remains fair, transparent and fully justifiable, reflecting genuine market conditions."
Meanwhile, Chancellor Rachel Reeves has asked Treasury officials to examine whether support may be needed for households reliant on heating oil, which sits outside Ofgem’s energy price cap that protects gas and electricity customers. Ministers are concerned families who rely on oil deliveries have little protection from sudden spikes in global markets.
For many households, the rising costs are already having real consequences. Sue Stevens, a former primary school teacher from South Lopham in Norfolk, says she was left stunned when the cost of her heating oil order suddenly doubled.
Ms Stevens, who cares for her 27-year-old daughter Charlotte, who has severe cerebral palsy and uses a wheelchair, had already paid £347 for 500 litres of heating oil on March 2. The delivery was scheduled for March 13.
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Sue Stevens, with her daughter Charlotte, was left stunned when the cost of her heating oil order suddenly doubled
However, on March 9, she received an email from the supplier stating that the price had increased to £660. She was told she could either pay the new price or cancel the order.
Mrs Stevens said the situation had left her struggling to keep her home warm. She said: “Surely oil companies have a duty of care. My daughter cannot walk and gets very cold and we have covered her in blankets."
“We are really low on oil and I’m not putting the heater on but it’s very cold.
“They are charging astronomical prices, but it seems that when prices go down again, it is not reflected so quickly in the charges.
“There does not seem to be any regulation of this industry and they can charge what they want.
“It seems we bought at a price and we thought that was the price we would pay, but it isn’t.
“I think it’s unethical and profiteering and just not fair to change the price.
"If you went to a shop and bought something, you wouldn’t pay more if they asked you to do so as you got to the exit door.”
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