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 letter was sent to the UK and Ireland Fuel Distributors Association1. Two days later, on 11 March, the Energy Secretary met the Competition and Markets Authority to discuss reports from heating oil customers following recent price spikes1.
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. In Great Britain, households that heat with oil are not covered by the energy price cap, unlike gas and electricity customers, and the sector is not regulated by Ofgem1. The government states that heating oil does not have the same consumer protections as other parts of the energy market1.
On 16 March the Chancellor announced over £50 million of targeted financial support for low income households in rural communities who have no choice but to top up their tanks1. The allocation is £17 million for Northern Ireland, £27 million for England, £4.6 million for Scotland and £3.8 million for Wales1. The funding was allocated on census data reflecting where need is greatest, and will go directly to the devolved governments1. In England it will be distributed by local authorities through the Crisis and Resilience Fund, which comes into effect on 1 April and targets areas with higher rates of oil heating1. The Household Support Fund runs until 31 March and is replaced by the Crisis and Resilience Fund from 1 April; £842 million a year has already been made available through the fund at Spending Review 20251.
"Heating oil prices have spiked sharply, and I know that for families in rural communities that is a real and urgent problem."
The government also set out measures it intends to take. These include an agreement secured with industry on a strengthened Code of Practice, covering greater flexibility on delivery volumes, improved price transparency and formalising a Priority Customers Register so that all vulnerable customers are eligible for prioritised support in times of disruption1. It is exploring stronger consumer protections that 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. It is also exploring the creation of a new ombudsman or the appointment of a regulator, such as Ofgem, to champion consumers, taking powers to do so through the Energy Independence Bill1. The CMA is examining reports of cancelled orders followed by higher quotes and price increases for automated deliveries, and announced on 14 March that it will take forward a detailed examination of the whole market at pace1.
Why it matters for households
Heating oil sits outside the energy price cap and outside Ofgem regulation, so a household buying kerosene carries the price movement directly and pays upfront for a tank top-up rather than by monthly bill1. That structure is what makes the timing of a purchase matter, and it is why the government describes oil heating households as exposed to more immediate price hikes1. For a home off the gas grid, the tank is the energy supply, and the terms on which it is filled, delivery volumes, quoted prices and priority during disruption, are the practical levers on that home's energy independence. The proposed Code of Practice and the possible appointment of a regulator would change those terms rather than the fuel itself. Northern Ireland is treated separately in the announcement because a greater proportion of homes there rely on heating oil1.
What happens next
The Household Support Fund ends on 31 March and the Crisis and Resilience Fund begins on 1 April1. The CMA's detailed examination of the whole market is under way1. The government has said it intends to introduce new consumer protections and is exploring an ombudsman or regulator, with powers to be taken through the Energy Independence Bill1. No date has been reported for the strengthened Code of Practice or for a decision on an ombudsman or regulator.