The ongoing conflict in the Middle East is driving up wholesale
prices for key commodities such as oil. Inevitably, this is
having an impact on the prices consumers pay for fuel, in
particular the cost of heating oil, which powers around 1.5
million UK homes, predominantly in rural areas, and is the main
source of fuel for heating in Northern Ireland.
The Competition and Markets Authority (CMA) knows that many
retailers behave responsibly and fairly – and that they are
likely to face significant pressures from rising wholesale costs,
which may impact prices. However, the CMA has heard a number of
concerning reports from consumers who rely on heating oil about
their experiences with retailers in recent days. The CMA will
therefore be engaging with heating oil suppliers and
intermediaries to gather evidence and consider whether retailers'
practices raise consumer protection law concerns.
An initial review of complaints has identified 2 main issues,
which the CMA will be probing further:
- existing orders for heating oil being cancelled, and
customers then being offered new quotes at significantly
increased prices
- price increases for automated deliveries (triggered when the
fuel in a tank drops to a certain level)
Sarah Cardell, Chief Executive of the CMA, said:
We know many households are worried about rising prices as global
events push up wholesale oil costs. It's inevitable that some
prices will rise, but they should reflect genuine cost pressures.
We've heard troubling reports from heating oil customers about
cancelled orders and sudden price increases – and are moving
quickly to get to the bottom of these concerns. As always, we
stand by consumers and will make sure they are treated fairly.
The CMA, as a matter of urgency, is writing to a number of firms
– both direct suppliers and intermediaries – to seek further
information about their practices.
The CMA is at the initial stage of its review, and it should not
be assumed that any businesses have broken consumer protection
law.
How the review progresses will depend on the evidence – this
could include the CMA taking no further action if it believes
that consumer protection law is unlikely to have been breached,
or taking enforcement action if potential breaches are
identified.
