The UK’s competition watchdog is probing concerns that households relying on heating oil are facing sudden price increases on the back of conflict in the Middle East.
The Competition and Markets Authority (CMA) said it had kicked off a review after receiving “troubling reports” from customers.
This includes complaints from people that existing orders for heating oil had been cancelled, and customers were then sent new quotes at significantly increased prices.
It is also probing cases of households facing price increases for automated deliveries, which are triggered when the fuel in a tank drops to a certain level.
Home heating oil is used by around 1.5 million households in the UK, but sudden volatility in the global oil trade has caused prices to spike by up to £100 in the past week alone.
The problem is particularly acute in Northern Ireland, where 62.5% of homes rely on the fuel, compared with the UK average of just over 5%.
Heating oil customers fall outside Ofgem’s energy price cap protection, which currently fixes prices until the end of June.
The CMA said it was writing to heating oil suppliers and intermediaries “as a matter of urgency” to gather evidence and consider whether the behaviour breaches consumer protection laws – which could result in enforcement action.
It stressed that it should not be assumed that any businesses have broken the law, and that many retailers are facing significant pressures from rising wholesale costs.
Sarah Cardell, chief executive of the CMA, said: “We know many households are worried about rising prices as global events push up wholesale oil costs.
“It’s inevitable that some prices will rise, but they should reflect genuine cost pressures.
“We’ve heard troubling reports from heating oil customers about cancelled orders and sudden price increases – and are moving quickly to get to the bottom of these concerns.
“As always, we stand by consumers and will make sure they are treated fairly.”
Chancellor Rachel Reeves said she was going to be meeting the CMA on Thursday and said the Government was working with the watchdog to tackle “any price gouging” in heating oil.
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