Oil homes warm to price drops

CONSUMERS who heat their homes with oil are enjoying the lowest prices in a year just as they are about to stock up for winter.

The price for 1,000 litres of heating oil has dropped €50 in a year to around €575 on the back of recent falls in world oil prices.

As Bord Gáis customers face a harsh winter with a 33.8% hike in bills, oil customers are warming to an 8% drop on last year’s costs.

David Blevings, of the Oil Promotion Federation of Ireland, said: “Oil is cheaper than gas for the first time in four to five years.

“The good weather has delayed purchasers’ decisions as have [previously] higher prices, but with oil now falling and gas going up, oil is more competitive.

“That’s good news for the consumer, as now is traditionally the time of highest demand for heating oil,” he added.

Around 39% of homes in the Republic are heated with oil-fired boilers, running on gas oil or kerosene, compared to 25% running on natural gas.

Consumers normally bought around 1,000 litres at this time of year to give them heating and hot water throughout the winter, an industry spokesman said.

The oil federation quoted figures showing an oil-heated home costs €1,470 a year to run, while the equivalent in gas would cost €1,543.

A snap survey of heating oil prices carried out by the Irish Examiner, yesterday, revealed prices hovering around the €575 mark for 1,000 litres in Cork, Dublin and Galway.

Last year, consumers stocking up for winter were having to pay around €630 for the same amount, due to high crude oil prices on world markets.

Pat Meehan, from the Maxol oil company, said, “It is amazing that, as we come to winter, the price of heating oil is not increasing but that’s the vagaries of the oil market.” Consumers also have more reason for cheer as Finance Minister Brian Cowen has indicated that he is likely to reduce excise duty on heating oil again.

In his last Budget, the minister made a cut saying he wanted to eliminate the differences in heating oil excise duty between the North and the Republic within two years.

The heating oil industry helped lobby for change, saying consumers did not pay excise duty on heating fuels like gas or electricity.

“It was unfair because oil was being penalised and other fuels were benefiting,” said Mr Blevings, of the Oil Promotion Federation of Ireland.