The Competition and Markets Authority (CMA) announced on Saturday 14 March that it will take forward a detailed examination of the whole heating oil market at pace, according to the government1. The confirmation came alongside a Treasury announcement of over £50 million of targeted financial support for low income households who heat their homes with oil1.
The CMA is already examining reports of cancelled orders followed by higher quotes and price increases for automated deliveries1. The Energy Secretary met the CMA on 11 March to discuss reports from heating oil customers following recent price spikes, and on 9 March the Energy Secretary and Minister Shanks jointly wrote to the heating oil industry warning of increased prices and action to protect consumers1.
The funding is split by nation, allocated on census data and paid directly to the devolved governments1:
| Nation | Allocation |
|---|---|
| England | £27 million |
| Northern Ireland | £17 million |
| Scotland | £4.6 million |
| Wales | £3.8 million |
In England the money will be distributed by local authorities through the Crisis and Resilience Fund (CRF), which comes into effect on 1 April, targeted at areas with higher rates of oil heating1. The Household Support Fund runs until 31 March and is replaced by the CRF from 1 April; £842 million a year has already been made available through the CRF at Spending Review 20251. The government said the support is aimed at low income households in rural communities who have no choice but to top up their tanks at a time when prices have risen so significantly1.
The government also set out an intention to regulate the heating oil sector, saying it does not have the same consumer protections and is not regulated by Ofgem1. Measures under consideration include an industry agreement on a strengthened Code of Practice covering greater flexibility on delivery volumes, improving price transparency and formalising a Priority Customers Register, so that all vulnerable customers are eligible for prioritised support in times of disruption1. Stronger consumer protections could cover dispute resolution, a greater variety of repayment options for those facing hardship, greater price transparency and enhanced protections for vulnerable groups such as the elderly1. The government is also exploring the creation of a new ombudsman or appointment of a regulator, such as Ofgem, to champion consumers, and taking powers to do so through the Energy Independence Bill1.
"They also announced on Saturday 14 March they will be taking forward a detailed examination of the whole market at pace"
Why it matters for households
Heating oil sits outside the arrangements that cover gas and electricity. In Great Britain, households that heat with oil are not covered by the energy price cap, so they are exposed to more immediate price hikes, and many, including some of the most vulnerable, must pay an upfront lump sum to top up their tanks to keep heating and hot water running1. The government says the price of kerosene, the fuel used for heating oil, has been especially affected by the conflict in the Middle East and is currently double that of crude oil1. Northern Ireland has a greater proportion of homes relying on heating oil, which is why it receives the largest per-nation allocation after England1. For a household off the gas grid, the practical questions are what a tank top-up costs, when it is bought, and what recourse exists if a delivery is cancelled or a quote rises; the CMA examination and the proposed protections bear directly on those points. The Heating Oil and LPG Supply in the UK guide covers how the market is structured, and the UK Home Energy Regulation and Policy: The Full Guide sets out where heating oil sits relative to regulated fuels.
What happens next
The Household Support Fund runs until 31 March, after which the Crisis and Resilience Fund takes over from 1 April, with England's share distributed by local authorities1. The government has said it is working with the Northern Ireland Executive to ensure protections are fit for purpose for Northern Irish households1. No date has been reported for the conclusion of the CMA's detailed examination of the whole market, and no timetable has been reported for the introduction of the consumer protections or for any decision on an ombudsman or regulator1.