Our home is fitted with a ten-year old
15/19 oil-fired combination boiler which provides the heating and hot water. Where we live, the other three houses also use domestic heating oil as a fuel source. Worcester
Unfortunately, domestic heating oil (kerosene 28) prices tend to fluctuate wildly in line with the world oil price. There was also a step change in kerosene prices just a few years back, with the costs jumping by 50% from around 40p to 60p per litre in just a few weeks during a particularly cold winter period, even peaking at around 75p in some locations for a short time, and nationwide they've never fallen too far below the 60p level since. Oil prices also suffer much more from 'downward price rigidity' than any other domestic fuel source, i.e. prices are quick to jump upwards on an oil price rise and very, very slow to fall when global oil prices fall.
Added to the facts that the UK domestic heating oil market is totally unregulated (sorry, I said no politics here...) and that most of the country's supply and distribution is in very few hands so that effective competition is non-existent, then those of us with oil-fired heating must simply endure huge annual costs, typically at least a third more than those with equivalent homes using natural gas.
So what are the options ? Let's base the comparisons on our annual heating and hot water costs of £1,500, which is an accurate reflection of the costs of last year's oil tank fills.