CMA recommends stronger protections for UK heating oil customers

Heating oil prices jumped 92% after Iran war, households describe struggle

The Competition and Markets Authority recommended that the UK government strengthen consumer protections for the 1.5 million households that rely on heating oil, after finding that the Iran war-driven price surge exposed significant gaps in safeguards available to customers connected to the gas grid.

The regulator’s report, published Wednesday, found that average retail heating oil prices peaked 92% above normal levels after the United States-Israel conflict with Iran began in February. While the CMA said the price increases largely reflected rising wholesale costs, it concluded there were “clear gaps” in protections covering how prices are quoted, cancellations are handled and support for vulnerable consumers.

“It is reassuring to know it is a competitive market but the lack of protection for these households does concern me,” Chancellor Rachel Reeves said. “We will look very seriously at what can be done.”

West Midlands residents who rely on heating oil described the financial strain. Jemma McCarron, who lives in Hanley Swan, Worcestershire, said she felt lucky to have filled her 2,000-litre tank for £1,200 days before the conflict started — a purchase that would have cost nearly £1,000 more a week and a half later. Her family has been using less hot water during heatwaves and “squirreling away that extra little bit of cash” to prepare for uncertain future prices.

“There’s a limit to what you can do with that given it’s our only source of heating and hot water,” McCarron said. She said improved protections are “so important” but called for more support for renewable alternatives. “We’ve been looking into solar panels but there’s very little support out there for people who might want to look at alternate ways for running their household.”

Nick Weaver, from Claverdon, Warwickshire, said his heating oil supplier delivered only half of the 1,000-litre order he had paid for before the conflict. The company told him it would refund half of his original payment, then offered to sell him the missing 500 litres two days after his delivery for an additional £1,000.

“I was incredibly shocked and felt cheated,” Weaver said. “I definitely felt like they were taking advantage of the situation.” He wrote to all the company’s directors in what he described as a last-ditch attempt to settle the issue amicably, leading to an agreement to supply the missing fuel at the previously agreed price.

The CMA said that 1,700 people whose existing orders were canceled after the conflict began should be refunded any extra money they had to pay. While a number of suppliers have agreed to compensate those affected, the regulator said it is considering legal action against those that have so far refused.

McCarron said the protections are necessary because “if the prices are sky high because of things totally beyond your control, there’s nothing you can do about that.” The report recommends improved protections covering how prices are quoted, cancellation handling and support for vulnerable households, the CMA said.