The 2016 outlook for heating oil prices looks good.

The price of oil per barrel has dropped to nearly $30, compare this to $80.00 per barrel in 2014. It was as high as $105.00 per barrel in 2013. The highest ever was $145.00, so this is substantially lower. The question is how does that translate to a price per litre? The latest club buys are as low as 25ppl.  However, the price per barrel has dropped again so prices may fall further.

What Does It Mean for the Average Household?

The price per litre will translate into £260 per 1,000 litres of oil. An average house, will probably use approximately 1,000 litres or more depending on insulation, how old your boiler is, and how cold the winter will be.  A saving of several hundred £’s on a few years ago – great news for homeowners.

Lower Your Heating Bills More

Home heating oil prices are at an all time low. What else can you do to help lower your heating bills?

First make sure you keep your boiler serviced – not only does this improve efficiency but it also ensures it operates safely.  Use a properly registered technician.

 

Secondly make sure you have the most energy efficient boiler you can afford. An energy efficient boiler will save you money in the end. There is a direct correlation between keeping your oil costs down and an energy efficient boiler.

Finally, consider your insulation. The more air tight your home is, the better. There are several things you can do that are relatively inexpensive. The simplest is to simply stop as many drafts as possible – doors, windows and chimneys being the biggest culprits..

Make sure there is enough insulation in your loft or attic. For every layer you put down, you can save money.

Insulation levels are specified by R-Value. “R-Value is a measure of insulation’s ability to resist heat traveling through it. The higher the R-Value the better the thermal performance of the insulation.”

Conclusion

Home heating oil prices are down and it appears will continue to drop for the foreseeable future. Oil prices are falling to their lowest in seven years. Homeowners will reap the benefits of low fuel prices combined with fuel efficient boilers and well insulated homes.

Having the correct heating controls is essential for an efficient heating system. Clever use of controls can help you minimise energy consumption by ensuring each room is at the right temperature for comfort, while avoiding overheating.

With the help from articles from Which, The Energy Saving Trust and OFTEC we take a look at the key elements of a good heating system.

Read more Boilers and Boiler controls ›

 

It easy to have a long list of resolutions but often  just doing a few things well can make all the difference. Here are our four New Year tips to help heating oil    users reduce their costs in 2015.

 

 

 

1. Join an Oil Buying Club.

Even with the recent reductions in the cost of heating oil there are still major benefits to be had from joining your local heating oil buying club.  Oil clubs typically save members 10% on their costs, and usually more when the order is for 500l.  Even when compared to the biggest on-line heating oil sites, buying clubs still offer great savings.  It’s not just about money;  the savings come as a result of lower transport costs which means fewer oil tankers on local roads.

You can find out more about the benefits of oil buying clubs from our video here  or at Citizens Advice.

On our site oilbuyingclub.com, you can search for a club near you

Read more Four New Year resolutions for home heating oil users ›

 

 

The rising cost of energy bills has been a controversial and well documented cause of concern – sparking debate at the highest level.

Nowhere is this truer than in rural areas – especially if communities have to rely on often expensive heating oil to warm their homes because they are not connected to the main grid.

With colder temperatures just around the corner this can put people under even more strain, particularly those on fixed incomes such as the elderly who are already struggling to make ends meet.

But a Wiltshire community has joined forces to help residents save money on their heating bills and has seen great success, helped by the falling cost of crude oil.

Eighteen months ago an oil buying club was formed in the Nadder Valley to the west of Salisbury. In that time, the club has grown to 220 members and sees no sign of letting up.

It draws from an area which includes Warminster, Market Lavington and Netheravon in the north through to Bulford, West Tytherley and Landford in the south, while also encompassing Verwood, Iwerne Minster, Tarrant Hinton, Mere, Gillingham and East Stour.

Richard Willan organises The Nadder Oil Buying Club, which was started by his late sister, Andrea Fox. He oversees a regular order which in the last year represented an average of 20,000 litres each month. However, in the last two months, orders have increased to 42,000 litres each month, reflecting clear growth in the club’s popularity.   The December order for 47,000 litres was fulfilled at 39.5p per litre.

Read more Press Release – Nadder Oil Buying Club ›

A warm welcome to Mike Parker and the members of SeSaME Oil Buying Club – www.sesame.oilbuyingclub.com .

 

Based in Sedgeberrow, the club covers an area to the south west of Evesham in Worcestershire.  We first met Mike when we presented at a meeting of Parish Councillors within the Wychavon District Council area.  A meeting followed on from that which led us to launching the club on the Oil Buying Club System.

Mikes role in the community includes the Oil Buying Club, sustainable energy projects and publication of the Sedgeberrow News.  On e project is looking at ways to improve renewable energy from the school roof.The club had an initial membership of circa 130 but this has been growing steadily since launching on the new system.  Villages in the area with members in the scheme include Ashton under Hill, Beckford, Dumbleton, Wormington, Hinton, and Aston Sommerville.  Mike aims to continue the growth in membership; it improves the effectiveness if the club which benefits his members and suppliers.

The first order was handled by Countrywide Fuels – a new supplier for the members.  Deliveries have gone well with the Suppler completing on time and without any issues.

Next orders will be later this month, ahead of the Christmas peak.  The forward order schedule is available here

 

There has been a lot of comment today about remarks made by Ministers regarding the price of crude oil and its potential impact on the price of petrol. Of course the link between crude oil prices and petrol is equally applicable to heating oil – it’s regrettable that once again Government (and the Opposition) fail to make any statements about the impact of prices on heating oil users.

The BBC article makes for interesting reading.  First it highlights that most of the cost of a litre of petrol is duty, indeed only about 25% of the price is the raw crude cost, this explains why significant fails in Crude prices may result in more modest falls in petrol prices.  Then they refer to a speech Danny Alexander is to make in which he refers to “rock and feather” pricing.  By this he means that prices rise as fast as a Rocket but float down as slowly as a Feather.

I understand the point he is making and share the view he has, but I don’t think it’s anything new.  Look at the price movements in any commodity, it will show wide variations in a short period of time.  With the issues in the Middle East and Russia causing concerns about energy supply, commodity traders have plenty of opportunity to play the fear factor into prices.  We have all seen short term spikes in prices – in the case of heating oil up to 2ppl in a 48hr period.  As most oil users buy only a few times a year it’s not necessarily short term movements that matter the most.  Sure, no one wants to have to buy on a day when prices rise, but it can happen.  Using Oil Buying Clubs can help mitigate the effect by helping achieve good value but even a club can’t stop the impact of a scare in the Middle East forcing prices up.

It’s the long term trends that are more relevant.  A comparison of relative prices of Gold, Crude Oil and Wheat (from IG Index)over the last two years shows that all three have prices lower than two years ago, 20% in the case of crude.

So falling global demand for commodities is driving down prices across the board.  Goldman Sachs are forecasting further reductions in Crude prices.  We have to ask ourselves if these long term reductions have been fully reflected in the prices we pay for the fuel in our cars or our heating oil.  For petrol the reduction in crude prices is less relevant as it only accounts for 25% of the product cost – for heating oil the link is much closer.

Mr Alexander may be right and prices do rocket up to only float down but that isn’t the real challenge for oil users.

It’s clear from the recent Club Orders we have processed that heating oil prices have fallen and the reduction from the peak of a year ago is significant.  We are now seeing the lowest prices since 2010 when prices started a steep climb.  The oil market is competitive, we see that every time a club order is tendered, the challenge for customers now is to know how much of a reduction to expect.  In a rising market the concern is that we pay to much, it’s equally true in a falling market – are the savings we are getting enough?

Club ordering is a great solution to this dilemma.  We can be confident that by working together we can get the best price available.  Experienced Club Managers can also ensure they time orders to avoid the obvious pitfalls.  Processing multiple clubs through the Oil Buying Club system gives us confidence that our broad base of suppliers can offer clubs great service and value.  For Club members it means the price they pay and the service they get is the best available.

As todays observations by the political parties show, oil users are very much out in the cold.  Working together helps more than any political statement.

 

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