The Government will explore what regulation the heating oil market needs, alongside a strengthened industry code of practice, stronger consumer protections and the possible creation of a new ombudsman or the appointment of a regulator such as Ofgem. The commitment was set out in a statement to the House of Commons on 16 March 2026, in response to price rises following conflict in the Middle East1.
The minister said the market is currently under-regulated, noting that "Unlike gas and electricity, the heating oil market is not regulated by Ofgem"1. The measures under exploration include dispute resolution, a greater variety of repayment options for those facing hardship, greater price transparency and enhanced protections for vulnerable groups such as the elderly, as well as support for the Competition and Markets Authority to carry out a more comprehensive examination of the industry1. The Chancellor has written to the CMA asking it to remain vigilant across heating oil prices and to tackle unjustified increases1.
"we are going to put that right by exploring what regulations might be needed to ensure that consumers get a better deal"
Alongside the regulatory work, the Government is committing over £50 million to help low-income families who use heating oil, allocated on census data on how many heating oil-fuelled households there are in each nation1. The minister said 1.5 million UK households use heating oil, and that some customers have reported prices doubling or being unable to secure a delivery at all1.
| Nation | Allocation | Delivery route |
|---|---|---|
| Northern Ireland | £17 million | Devolved Government |
| Wales | £3.8 million | Welsh Government |
| Scotland | £4.6 million | Scottish Government, through existing programmes |
| England | Remainder of the over £50 million package | Local authorities via the crisis and resilience fund, from 1 April |
The minister said the funding will go directly to the devolved Governments with the expectation that it will be used to support vulnerable households, and that LPG is included in the package, with guidance to local authorities making clear it covers LPG as well as heating oil1. The announcement covers domestic premises, with details for non-domestic premises to follow1. The minister said the current household support fund and the future crisis resilience fund are discretionary, and it will be for local authorities to determine what they provide under the guidelines1. People in crisis applying to the existing household support fund are eligible for support from today, with the additional funding coming after 1 April1. The minister also said electricity and gas prices will reduce on 1 April by 7%1.
Why it matters for households
Heating oil is not covered by the price cap that applies to gas and electricity, and the market has no regulator equivalent to Ofgem1. Households that rely on oil, LPG or other delivered fuels therefore buy at prices set by their supplier, often a single local firm, and face the full effect of movements in international crude prices. The support announced is discretionary and routed through local authorities in England and through devolved administrations elsewhere, so what an individual household receives will depend on decisions taken by those bodies rather than on a national entitlement1. The regulatory measures described are at the exploration stage, so no change to how the market operates has taken effect. For a home weighing its exposure to delivered fuel prices, the practical position is unchanged for now: the market remains unregulated, and the announced protections are proposals rather than rules.
What happens next
The crisis and resilience fund comes into effect on 1 April, when electricity and gas prices are also due to fall by 7%1. The Minister for Local Government and Homelessness has written to council leaders in areas receiving additional funding1. The Government says it is moving at pace with the CMA and has asked it to look at the market1, and that it will keep the situation under review1. No timetable has been reported for decisions on a strengthened code of practice, new consumer protections, an ombudsman or a regulator.
Sources1 cited
- Heating Oil Support - Hansard - UK Parliament, hansard.parliament.uk