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Consumer Council considers OFT Super Complaint
7th November 2008
The Consumer Council in Northern Ireland has claimed that oil heating customers in Northern Ireland may be paying too much for home heating oil. According to the Consumer Council, the last time crude oil was at this week's price, consumers paid on average £275 to fill a 900 litre oil tank. Today, according to the Consumer Council they are typically paying £416.
Enquiries to fuel distributors in the Greater Belfast area this morning by OilFiredUp.com, showed prices ranging from £391.80 to as much as £431.90, whilst heating oil price comparison website Cheaper Oil showed prices ranging from £387.45 with Niall Clarke Oils in Newry to a whopping £434.00 from Carlisle Fuels in Ballynahinch and Carrickfergus. For a delivery to the Craigavon area, the most competitive price available from BoilerJuice.com was £412.97.
The Council is questioning whether the province's home heating oil market is working for consumers and unless the home heating oil industry can assure customers that they are paying a fair price, the Consumer Council claims it will consider referring this matter to the Office of Fair Trading for investigation.
Steve Costello, Chairman of the Consumer Council said, "Seven in ten homes here depend on oil for heat. That is nearly 500,000 households who are paying 51 per cent more to fill their oil tank than they did last year and they need to why this is the case. Consumers are facing an unprecedented rise in their cost of living as they face into this winter not knowing how they are going to afford to stay warm and well. The home heating oil industry has a responsibility to prove to customers that they are not paying over the odds to fill their tank.
"When the price of crude oil goes up, the industry is quick to pass this onto consumers but it does not appear to be the same story when it comes down."
"Since the summer the cost of crude oil has fallen by more than half and consumers have anxiously waited to see the full benefit being passed on to them when they fill their tank. In our view, this has not happened in the home heating oil industry. Consumers will no longer accept at face value the vague explanations being given about currency exchange rates or an increase in demand without the evidence to stack it up. The Consumer Council will consider referring this market to the Office of Fair Trading using our super-complaint powers if we do not get the answers needed."
"The Consumer Council will continue to monitor the price of crude oil and how this affects the price we pay to fill our heating oil tanks. We will also publish weekly updates about the cheapest, dearest and average prices across Northern Ireland. This will help consumers know what price they should be paying and negotiate the best deal. Visit the website at www.consumercouncil.org.uk"
In response, David Blevings from the Northern Ireland Oil Federation which represents many of the province's fuel distributors speaking to the BBC said, ""The retail cost of home heating oil is based on the cost, demand and availability of refined product out of Rotterdam and is sold in dollars,"
"If the Consumer Council had done its homework they would see the figures they have mentioned from February 07 to today, there's a 50% increase in the wholesale kerosene price."