Heating-oil customers affected by cancelled orders and price increases during the early days of the U.S.–Israel conflict with Iran are set to receive compensation, the Competition and Markets Authority (CMA) said on Wednesday. The watchdog noted that about 1,700 households were forced to re-order at significantly higher prices or go without fuel, with potential costs reaching up to £350 per household.
Some suppliers have agreed to compensate customers, and the CMA indicated it could pursue legal action against those that have refused to compensate thus far. The UK and Ireland Fuel Distribution Association (UKIFDA), which represents heating-oil suppliers, said there were a small number of cases requiring redress. Wholesale oil prices rose sharply during the period, with prices jumping from around $70 a barrel at the war’s outset in February to nearly $120 a barrel by the end of March, influencing heating-oil prices in the UK as well.
The CMA’s inquiry found that the price increases largely reflected higher wholesale costs and that suppliers did not profit materially from the crisis. It also highlighted that heating-oil users do not enjoy the same protections as electricity and gas customers, and recommended stronger consumer protections, including clearer price quotes, better handling of cancellations, and improved support for vulnerable households.
Chancellor Rachel Reeves welcomed the finding that the market is competitive but said the lack of protections for affected households warranted serious consideration of reforms. UKIFDA’s chief executive, Ken Cronin, said the industry would cooperate with government bodies on the recommended changes. The CMA has not disclosed how many suppliers will compensate or the amounts involved, noting that some customers who replaced cancelled orders will be reimbursed for the difference, while others who did not replace orders will have their original prices honoured.
The CMA’s four-month investigation into the heating-oil sector followed ongoing reporting of disruptions and price volatility tied to the Iran-related crisis. The CMA estimated that about 1.5 million households rely on heating oil and that protections are weaker in many parts of the country, especially Northern Ireland, where a large share of households depend on heating oil.
The case also features individual accounts of customers affected. One resident, Anthony Maines of Seaton Delaval, Northumberland, paid £463.83 for 700 litres on 28 February, then had his order canceled and subsequently reordered 500 litres at about £700 with another broker. He says he locked in the earlier price hoping for stability as prices rose, and a broker later agreed to honour the initial price, though by then he had already paid higher prices elsewhere.
