Colder weather is keeping prices high

Saturday 16th January 2021

Cold weather is keeping prices high. A continued or renewed cold wether pattern will determine your heating oil price well into February.

However, more cold weather is forecasted for this week will see heating oil users checking their tank levels probably buying fuel at higher prices.

Not surprisingly, if the weather worsens as we progress through winter fuel deliveries will put pressures on a distributor’s logistics.

Market Trends

Colder weather is keeping crude prices high
Crude Oil prices at 18:00hrs 31st December 2020

Since our last report big gains have been made in Crude Oil prices. Coupled with the poor UK weather helped push up UK domestic heating oil prices.

Oil prices fell back on Friday over demand concerns. News that China has reported its highest Covid-19 case count in months weighed on market sentiment.

Cold weather is continuing to hit the UK. Now is the perfect time to make sure your tank has enough fuel to see you through the winter. Before you order fuel ensure you are getting the best possible prices by using heatingoilshoip.com for multiple quotes.

Other Market Factors

Oil prices shot up to a 10-month high, posting further gains in the wake of the OPEC+ cuts. They also edged a bit higher by a weaker dollar.

OPEC+ compliance slips to just 75%. OPEC+ group’s compliance with the oil production cuts fell to 75% in December 2020—one of the lowest levels since the pact was enacted in May 2020

UK Market Trends

Colder weather continues to dominate UK heating oil prices in January

Within the next 2 weeks a cold start is expected and wintry showers could be quite widespread. There is the potential for more prolonged spells of rain, sleet and snow through the week. The risk of snow is the greatest in the north. It could become milder at times in southern and central regions. Frosts are likely to be widespread and sharp on some nights.

Under these circumstances expect to see heating oil prices to remain high but, still some 20% lower than this time last year.

Colder weather is keeping prices high

Ultimately, the good news is heating oil prices are still 20% cheaper than for the same period last year.

However, we see further demand for heating oil increasing as the weather stays colder until mid February.

At this moment in time, we see distributor prices remaining at today’s level with any movements restricted to 10ths of a penny. Most distributors are quoting between 36ppl to 40ppl. Brokers are much higher and in the range of 41ppl to 44ppl.

UK Regional Analysis

Colder weather is keeping prices higher. UK heating oil prices have increased by 2.23% this week. Over the last 7 days there has been an increase in the average UK oil distributor heating oil prices of 0.87ppl.

Colder weather is keeping prices high

At the moment distributor heating oil prices are trending up.

England – average prices rose by 1.24ppl to 41.37ppl.

Wales – average prices fell by 0.82ppl to 42.47ppl.

Scotland – average prices rose by 1.01ppl to 44.70ppl.

Northern Ireland – average prices rose by 0.70ppl to 34.94ppl.

Of course, the colder conditions in some now all of the regions are affecting prices. At the present time we recommend you check your heating oil tank regularly. Also check our daily twitter feed @ukheatingoils. You can request multiple quotes from heatingoilshop.com on a regular basis to avoid any possible imminent price rises.

Distributor Analysis

Colder weather and crude oil prices continue to determine heating oil prices.

During the last 7 days, UK heating oil prices have risen by 2.23% this week. This amounts to an average rise of just over ¾ of a penny after adjustments and vat.

Generally speaking we feel that UK heating oil prices may have reached their peak and will plateau this coming week. Ultimately, if crude oil prices rise there could be changes.

A continued cold spell into the third week of February could be a game changer.

Colder weather is keeping prices

As of today, the UK heating Oil price of 39.81ppl is 9.89ppl lower than this day a year ago. Not only that, 4 years ago the price was 49.98ppl, 10.17ppl dearer.

As such, this is still a great opportunity to reduce heating costs substantially. Take full advantage of the lower prices now and save. Buy heating oil now as cold weather is on its way!

Distributor vs Broker Analysis

Colder weather is keeping prices high. Average prices for distributors rose 0.87ppl on the week. Similarly, average broker prices also rose by 0.63ppl.

To put it briefly, the difference between average distributor heating oil prices versus average online heating oil broker prices today is 4.14ppl inc vat.

In other words, brokers are maximising their profit margins at your expense. They are more concerned with this than your loyalty. This is the one main reason not to use a heating oil broker. On these numbers you would have paid an additional £41.40 on a 1000 litre delivery.

Savings fluctuate and depend on your postcode and any other charges made by brokers.

For instance Boilerjuice™ charge an additional £3.49 and is applied to each order of heating oil or gas oil (red diesel) placed on their website or over the telephone.

Furthermore, brokers do not tell you their commission rate as it is calculated into the PPL. So always ask and check your final total. There are many bargains out there, especially from suppliers.

Today’s Broker Analysis

Average broker prices are up to 43.95ppl today. As you can see from the graph below, some brokers are much more expensive than others.

As can be seen, today there is a 5.91ppl difference separating the higher and lower priced brokers in our random postcode check.

Consequently, and fortunately for you, there are plenty of cheaper heating oil bargains from distributors around the country.

Price difference calculations are based on 1000 litres delivered in 5 days to the same randomly picked postcode.

Avoid Brokers

Buying heating oil is all about timing! You would be better off comparing prices from heating oil distributors in your area by using our site heatingoilshop.com.

Remember, prices and savings change regularly and are delivery postcode dependant.

Heating oil brokers charge a variety of commissions, surcharges & admin charges or a mixture of all and these affect your final bill.

The graph above shows you seven-day prices for brokers. Some of these quotes include delivery charges, commission and admin charges. All of which push up the PPL exclusive of VAT price.

As you can see, there are some brokers that are consistently better priced than others.

Fortunately for heating oil consumers there are plenty of heating oil distributor bargains around the country.

Things to do

For current price trends, head on over to our main website at heatingoilshop.com and get multiple heating oil quotes from suppliers to your area.

Always check our daily postings on Twitter @ukheatingoils and keep up with prices and events. You are most welcome and encouraged to follow us.

We would like to draw your attention to an initiative by UKIFDA to keep our elderly, especially those over 75 years, comfotable this winter. You can read all about it here.

Also check out our post on heating oil tanks and new legislation regarding heating oil boilers. Every heating oil user must be aware of the these changes in legislation and costs associated with heating oil spills and leakages.

There is also a very nice piece about whether or not the heating oil is the cheapest fuel. Click here.

Summary

Colder weather is keeping prices high. We are encouraging all customers to get multiple heating oil quotes & order on the best price possible. A combination of dropping temperatures, tiered lockdowns will result in longer delivery times & probably higher prices.

Do not copy any content or images without our consent. Copyright © 2012-2020