Saturday 24th October 2020
Buying heating oil is all about timing!
Last week was a repeat performance from the previous week. Oil trading markets prices posted very strong gains mid week but failed to maintain the momentum and fell back Friday. This market performance has now happened three weeks in a row. It also suggests that OPEC+ is heavily supporting the oil price to prevent further price erosion and threatening to cut back production.
Friday morning the market opened slightly down. However, WTI was trading at under $40 as Brent closed nearer to $42.
COVID cases are now surging around the globe, threatening oil demand and sending oil prices back below $42.
On Thursday, the U.S. reported more than 70,000 COVID cases for the first time in three months, and the trajectory suggests the U.S. may break new record highs in the coming days.
The numbers help explain weak fuel demand in the U.S. This also seems to be the theme currently unfolding in the EU.
The pandemic continues to largely cap any potential crude oil price rally. On the other hand this has helped UK and European heating oil prices where demand is set to surge. It just needs one cold period will change to kick it off.
Crude did recover slightly on Friday with Brent managing to reach $41.77. For the best part crude has traded at an average of $40 for the better part of four months. now for nearly 4 months.
UK Market Trends
Autumn distributor heating oil bargains have not gone away. But, some broker prices are uncompetitve. Worthy of note though are directoil, homefuelsdirect and the heatingoil club all of whom maintain a quality pricing structure. UK prices did rise mid week but quickly fell back by today.
Although the price fall of 0.17ppl is small the overall price did not fall below 28.25ppl. Take note, the heating oil price trend is currently flat to falling and is more weather dependant than on crude oil pricing. Make no mistake, colder weather is on its way. We feel by the end of the month the price will rise!
Although prices continue to be at an all time 4 Year low, demand for heating oil is rising. The good news today is that prices are around 43% cheaper than this time last year. Inevitably, we will see further demand for heating oil increasing as the weather becomes colder, so, buy heating oil now and fill up.
Buying heating oil is all about timing! At this moment in time, we see distributor prices remaining at these levels for a at least 4 days. Most distributors are quoting between 26ppl to 30ppl.
UK Regional Analysis
UK heating oil prices have fallen by 0.60% this week. Over the last 7 days there has been a decrease in the average UK oil distributor heating oil prices on the week of 0.17ppl finishing up at 28.25ppl.
At the moment distributor heating oil prices are trending flat to down.
England – average prices fell by 0.19ppl to 28.75ppl.
Wales – average prices fell by 0.02ppl to 29.59ppl.
Scotland – average prices fell by 0.02ppl to 32.58ppl.
Northern Ireland – average prices fell by 0.11ppl to 25.90ppl.
To keep advised on heating oil prices we recommend checking in on our twitter feed. You can also request multiple quotes from heatingoilshop.com on a regular basis to avoid any possible imminent price rises. We’re not teaching our customers to suck eggs but always fill your heating oil tanks on lower prices.
During the last 7 days, UK heating oil prices have risen by 0.60% this week. This amounts to an average rise of 0.17ppl after adjustment and vat.
For the time being, milder weather has arrived and while heating oil prices are trending down, falling crude oil prices may push UK prices lower. At this moment in time, we are in a holding position and we see domestic prices possibly falling more.
Crude oil prices floated higher mid week, fell back by Friday and still trade in a tight band. Growth in crude oil has been severely restricted. We see no change for the coming weeks. Any small movements will have little effect on the UK heating oil market.
As of today, the UK heating Oil price of 28.25ppl is 21.09ppl lower than this day a year ago. Not only that, 4 years ago the price was 40.80ppl, 12.55ppl dearer. As such, this is a great opportunity to reduce heating (and cooking) costs subsatantially. Take full advantage of the lower prices now. Buy heating oil now as cold weather is on its way!