Heating oil prices are calculated daily if not more. Pricing is dynamic and the margins for end suppliers (downstream) supplier are incredibly small. You have a certain amount of control and the following are some of the key pricing factors:
- Buying in bulk reduces your price hence clubbing together as a community will benefit everyone. A full tanker making deliveries to one area is efficient. The efficiency cost saving is reflected in an overall reduction in the price you pay.
- The price per litre will be less for larger orders so where possible ensure you can take 1,000 litres or more in a single order.
- Your postcode region is a big factor i.e. distance from the suppliers depot and the number of drops that can be made enroute.
- Heating oil Pricing is always cheaper when the climate is warm so ensure you get at least one big order in during the warmest period of the year. If you have room for a larger or additional heating tank tank it will provide you with a good return on investment.
- Busy periods, cold weather conditions, prices escalate. In part this is due to additional logistic requirements i.e. paying drivers over-time. However, heating oil companies trade all year and profits are very thin during warm weather so profit shortfalls are made up as supply demand increases.
- Automated delivery is more expensive. However, the convenience and the guarantee that you will not run is definitely a benefit. Customers with an automated delivery contract are high priority when the heating oil market is busy.
- Buying from intermediaries is cheaper but more risky than buying direct. The intermediary does not take responsibility for the supply they go with whomever is offering them the best deal. However, the best deal may depend on attaining a certain volume. As such your order may not be processed until the volume commitment is reached.
Brent crude is the raw material for heating oil in the UK hence it is interesting to track the material cost of oil compared to the consumer pricing. The “Brent” crude price excludes refining, transportation and administration costs.
You can calculate today’s heating oil pence per litre price by using our calculator to the right. To use it take the price per barrel listed above and enter it into calculator in the right hand column. You will need to adjust the exchange rate to obtain the price you should be able to get from your supplier. Haggle well!
Garden wall – help your neighbours and community
We want to know what you paid and to which supplier for your heating oil. By adding your Postcode, first 3 digit only, order quantity, price paid and supplier you will help someone else in your community. Blogs UK is your “garden wall” so tell your neighbours about the best price you got so they can get the same. Use the comments box below and thank you..
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