Renewed consumer confidence combined with the unprecedented fall in kerosene prices have had a significant and positive impact on the industry. Overall oil boiler sales in 2015 are higher than any year since 2010. Sales over the summer have been particularly strong, suggesting that uncertainty over subsidies for renewable heating products, following changes in government policy, may also have influenced consumer thinking.
OFTEC’s director general, Jeremy Hawksley, said: “Feedback from installers has been positive this year, suggesting that there’s plenty of work around. Consumers are also increasingly aware of the need to find an installer they can trust, which is reflected in the rise in usage of OFTEC’s online ‘find a technician’ search facility. It’s clear that consumers are choosing oil because they want reliability and value for money.”
The favourable oil price is likely to be a key factor in consumer decision-making. The average UK selling price of kerosene in England and Wales fell to a six-year low of around 35ppl in August, almost 50% cheaper than when prices peaked in spring 2013.
Jeremy continued: “The low price is making an enormous difference to households using oil, leading to annual savings of hundreds of pounds. Oil is now by far the cheapest major heating fuel with typical annual costs currently around £886 – that’s 44% cheaper than LPG, 45% less expensive than electric storage heaters, and 18.5% cheaper than mains gas.
“Oil heating users have benefitted directly from the fall in crude oil prices because the price falls have been passed on to consumers – unlike other fuels. This has made oil heating very attractive, and not just for existing users.
“Predicting the future kerosene price is always difficult, but with world demand for crude oil still low, and high output still leading to an oversupply in the market, it’s likely that prices will remain comparatively low for some time to come.”