Heating oil comparison: how does it work?
16 March 2026: The government has announced a support package worth £53 million to help households that use heating oil in the wake of spiking prices as a result of the ongoing Middle Eastern conflict.
What is heating oil and how is it different to gas?
Unlike homes that use mains gas from the grid and have their gas supply more or less “on tap,” heating oil must be purchased directly for delivery to the home in bulk and stored in a tank.
The primary heating oil for UK homes is kerosene (as opposed to red diesel, which is used for commercial purposes and is generally more expensive).
This kerosene heating oil can come in two grades, premium and standard, which are priced accordingly. The premium heating oil has chemicals added to it designed to improve your boiler’s efficiency and cut down on sludge build-up in the supply tank - similar to premium petrol for your car.
How much does it cost to heat my home with heating oil?
Just like mains gas prices, heating oil prices can - and will - fluctuate with the market.
However, unlike a mains gas user, a heating oil user will feel this impact more directly as they are purchasing the oil in real time versus buying it from an energy supplier who has purchased their energy well ahead of when the gas itself gets used.
There are several factors that impact heating oil prices and your ability to get the cheapest heating oil, including:
- Crude oil prices
- Refining costs
- Distribution and delivery costs
- Increase in demand
- VAT rates
- Weather conditions
- Currency exchange rates.
What is the average cost of heating oil in the UK?
This chart from heating oil comparison site BoilerJuice tracks the cost per litre of heating oil from March 2022 to March 2026. We can see the tail end of how the wholesale energy crisis affected the cost of heating oil, with a significant peak in March 2022. We can also see how the current conflict in the Middle East between the US/Israel and Iran has caused the price of oil to spike. As of 9 March, heating oil costs 133.63p per litre, compared to 60.46p on 28 February, when the conflict began.
What can I do about heating oil price spikes?
Generally, there's not much you can do. Heating oil isn't capped by a price cap, so customers aren't protected that way. However, the government has committed to financially supporting households affected by heating oil price spikes.
Local authorities will distribute money to affected households via the Crisis and Resilience Fund from 1 April. England will receive £27 million, Northern Ireland will receive £17 million, Scotland will receive £4.6 million and Wales will receive £3,8 million. Details regarding exactly how the money will be allocated and which households will qualify are to be determined by local authorities, but households may have to apply rather than being automatically eligible.
Additionally, Ed Miliband, the Energy Secretary, has warned that heating oil suppliers will have to ensure that oil continues to be fairly and transparently priced in response to reports of price gouging.
How do I compare heating oil prices?
When it comes to comparing heating oil suppliers, there are heating oil comparison sites that do this for you, saving you the time and effort it takes to call each supplier individually to compare prices per litre.
Heating oil comparison sites like BoilerJuice will do your haggling for you, and can even group local orders together to get a greater bulk discount.
What should I consider when finding a home heating oil supplier?
Thankfully, there are quite a few heating oil suppliers that you can purchase kerosene from, meaning you should be able to find competitive prices.
As always, though, homes using heating oil shouldn't just consider price, but also factors like customer service reputation.
