More than 1.5 million households across the UK, primarily in rural areas, are being left vulnerable to volatile heating oil prices and a lack of consumer protections, the energy regulator has warned. Ofgem has called on the government to introduce new safeguards, arguing that those reliant on oil for heating currently have no equivalent of the price cap that protects mains gas customers, leaving them exposed to sudden price spikes and aggressive sales tactics.
The average heating oil bill now stands at approximately £1,800 per year, up from £1,600 in 2024, according to industry data. This comes as overall household energy costs remain elevated, with the typical dual-fuel bill under the price cap sitting at £1,736 per year. For off-grid homes, the financial burden is compounded by higher delivery charges and a lack of switching options, with many suppliers demanding upfront payment or imposing steep penalties for early contract termination.
Ofgem's recommendations include introducing a mandatory price comparison tool, banning unfair contract terms for prepayment customers, and requiring suppliers to offer clear, upfront pricing. The regulator also wants to see the Warm Home Discount, currently available only to electricity customers, extended to heating oil users. The government has not yet confirmed whether it will act on the proposals, but a consultation is expected in the coming months.
For households already struggling with rising living costs, the impact is severe. Food prices have climbed 4.3% over the past year, and average private rents in England have reached £1,300 per month. Universal Credit recipients, many of whom live in off-grid properties, have seen their payments rise by only 6.7% in April, failing to keep pace with inflation in key essentials. Citizens Advice has reported a 22% increase in enquiries related to heating oil debt since January.
Consumers can take steps to reduce costs now. MoneySavingExpert recommends buying heating oil in summer when prices are typically lower, forming a local buying group to negotiate bulk discounts, and checking for oil price comparison sites that show live supplier rates. The site also advises checking eligibility for the Warm Home Discount and applying for the Household Support Fund via local councils, where available.