By Claire McNeilly
Wednesday, 17 June 2009

The cost of home heating oil has gone up by around 10% in just three weeks, the Belfast Telegraph can reveal.

New figures show prices have risen steadily since the start of June, with Northern Ireland householders now paying on average £335 for 900 litres.

The hike comes as oil leapt above $70 a barrel — from its 2009 low of $32 — prompting industry experts to predict further increases are in the pipeline.

And while there is no suggestion of a return to last summer’s record tariffs, consumers are equally unlikely to see prices fall over the coming months.

Northern Ireland Oil Federation spokesman David Blevings said “market optimism” was driving up the price of heating homes.

“Home heating oil prices are increasing as world optimism believes that the worst of the global recession is over,” he said.

“Prices are currently boosted by a weaker dollar coupled with a higher equity market and is being driven once again by speculators.

“We are suggesting that consumers concerned about the increasing prices should consider filling their tank now.”

Mr Blevings said that oil is much cheaper (over 60%) cheaper than this time last year.

And he said: “We don’t foresee prices getting anywhere near the level seen last year as elevated oil prices will constrain any chance of economic growth.”

Information provided by a leading price comparison website shows, on average, a £2-a-day hike since the beginning of the month.

That means tariffs are now increasing at the same rate as they did last summer — which culminated in July 2008 with a price peak of almost £600 for 900 litres.

Data provided to Belfast Telegraph also indicates that, on June 1, 900 litres of home heating oil cost £305 compared to £335 yesterday.

Indeed, the Belfast Telegraph uncovered price increase variations of between £23 and £34 for 900 litres, over the last fortnight, depending on distributor.

Our snap survey also found 500 litres — yesterday averaging £194 — cost between £11 and £21 more compared to the start of June.

One local distributor commented, that there was “every possibility” of more prices increases.

“Since March prices have increased very slightly but steadily on an ongoing basis,” he said.

“It’s very, very difficult for distributors to predict how prices are going to go, but now is probably as good a time to buy as any.

“The local market is extremely competitive at the moment. There are no great margins in oil distribution at the best of times and in the summer it gets ultra-competitive.”

Spokesman for the UK Federation of Petroleum Suppliers, Rod Prowse, said he didn’t foresee any sharp reductions in price.

“I would be more inclined to look at replenishing now rather than waiting,” he said.

Exactly a year ago, average June prices were over 60% higher than today, at £558 for 900 litres and £318 for 500 litres.