Compensation Scheme for Affected Heating Oil Customers
In light of recent price surges in heating oil, substantial compensation is anticipated for customers who were compelled to procure replacement oil. This situation arose after some suppliers cancelled orders, prompting intervention from the Competition and Markets Authority (CMA), which has now secured an agreement for compensation from affected suppliers.
Customers who were impacted by these cancellations but did not purchase replacement oil will have their initial orders fulfilled at the previously agreed prices. The CMA has taken this decisive action to address concerns regarding potential breaches of contract by suppliers during a period of significant price fluctuations.
Understanding the Financial Impact
The CMA’s investigation revealed that numerous customers, particularly those who placed orders through intermediary websites, faced financial strain due to abrupt cancellations. While many received refunds for their original orders, they were often forced to buy oil again at inflated prices, resulting in increased costs ranging from £150 to £350 per order.
With the CMA’s intervention, customers who have paid more for their replacement oil can expect to receive compensation that covers the difference between their original and replacement purchases. For those who opted not to buy replacement oil, their original orders will be honoured at the price initially agreed upon.
Next Steps for Eligible Customers
Eligible customers need not take any action at this moment, as they will be contacted directly regarding their compensation. Approximately 800 customers have already received notifications, and the CMA continues to work with suppliers to ensure that all affected individuals receive their due payments.
For customers claiming compensation for replacement purchases, it is essential to provide documentation such as receipts and delivery notes to validate their claims. This step will facilitate a smoother compensation process and ensure that customers are reimbursed appropriately.
Statement from CMA Leadership
Sarah Cardell, Chief Executive of the CMA, emphasised the importance of heating oil, stating, “Heating oil isn’t a luxury; it’s a necessity that many people rely on for hot water and warmth in their homes.” She highlighted that the recent price spikes left numerous customers either financially burdened or without essential fuel, prompting the CMA’s action to rectify the situation.
Cardell reiterated that suppliers have now committed to compensating those affected by either issuing payments or honouring their existing contracts, reinforcing the commitment to uphold consumer rights during challenging market conditions.
Heating Oil Price Trends
The situation surrounding heating oil prices has seen dramatic fluctuations. For instance, between February and March 2026, average prices surged by 64%, increasing from 64 pence per litre to 104 pence per litre. This spike peaked at 123 pence per litre in April, representing a staggering 92% increase since February.
On average, consumers faced an additional £200 expense for a standard 500-litre order in March compared to February, with wholesale costs accounting for a significant portion of this rise. While prices saw a modest decline of 15% in May 2026, they remain significantly higher than pre-conflict levels in the Middle East.
With approximately 1.5 million households in the UK relying on kerosene for heating and hot water, the CMA’s actions are crucial in addressing the financial repercussions faced by consumers during this turbulent period.