Business

Increase in heating oil cost steepest in six years

The cost of home heating oil rose 16 per cent in October
The cost of home heating oil rose 16 per cent in October The cost of home heating oil rose 16 per cent in October

THE cost of home heating oil rose at its highest rate for six years last month.

The fuel shot up 16 per cent in cost to just under 40p per litre by the end of October.

It meant a delivery of 900 litres cost more than £350 from many suppliers.

The rise, which was the steepest since the winter of 2010 was also the third fastest increase in recorded history.

And it put prices well ahead of last year when the cost for 900 litres dipped below £200.

The most significant factor in the increase was a 8.5 per cent increase in the price of crude oil over the period - reaching one-year high of $53.29 at one point.

Other factors included the weaking of the pound following the EU referendum result while there is also speculation that many major oil producers, in particular Russia, were open to striking a deal with OPEC to reduce oil output.

Ian Ronald, CEO of independent heating oil website BoilerJuice said: "Whilst the recent price rise has been dramatic, heating oil still represents the cheapest form of energy available after historic price lows earlier in 2016.

"We do recognise times are uncertain for heating oil users, and we will continue to work hard for customers to provide the best price, service and convenience through our nationwide network of selected local suppliers.”

Although the average cost of home heating oil has dropped again this week, some analysts believe they could rise again ahead of the next OPEC meeting on November 30.

And many traders have speculated crude oil prices rising above $65 per barrel in 2017.