Cold reality for poorest households

oil tank World oil prices have risen since the start of the year, and this cost is being passed on to consumers

The Northern Ireland Assembly has been told that a growing number of households have no choice but to purchase 20 litre drums of oil that are significantly more expensive per litre than buying in bulk.

BBC's consumer correspondent Martin Cassidy has been calculating what that means at today's home heating oil prices.

So what are the relative costs?

A cash and carry fuel supplier in Belfast is currently selling 20 litre drums of home heating oil at £20. Our first calculation is a nice simple one.

Buying oil in drums works out at an even £1 per litre.

The same company will also make a bulk delivery of oil to your home. The minimum delivery is 200 litres and the price is currently £157.50. That works out at 78p a litre.

For consumers who can afford to buy larger quantities the savings are even bigger.

A delivery of 500 litres is currently available at just over 60p a litre while a householder ordering 900 litres can expect to pay just over 58p per litre.

Cost Comparison

Purchase Quantity Price (pence/litre)

20 litre drum

100

200 litres

78

500 litres

60

900 litres

58

Now lets compare the annual heating oil cost for a household which relies on buying 20 litre oil drums with homes which can afford to purchase oil in larger volumes.

Assuming annual oil usage of 2760 litres, the relative annual costs look like this:

Relative annual costs

Household Buying 2760 litres Annual Bill

138 (20 litre drums)

£2760

200 litre deliveries

£2152

500 litre deliveries

£1656

900 litre deliveries

£1600

The comparison shows a yawning gap in annual heating costs.

Not surprisingly the household relying on buying its heating oil in 20 litre drums is paying a lot more for fuel.

Compared to buying in 200 litre amounts, the extra annual cost works out at £608 a year or almost £12 per week.

And as the ability of the household to afford to order larger volumes increases, so the savings increase for the more affluent consumers.

At its most stark, the annual difference is £1160 which works out at over £22 a week.

More Northern Ireland stories

RSS

Features

BBC © 2014 The BBC is not responsible for the content of external sites. Read more.

This page is best viewed in an up-to-date web browser with style sheets (CSS) enabled. While you will be able to view the content of this page in your current browser, you will not be able to get the full visual experience. Please consider upgrading your browser software or enabling style sheets (CSS) if you are able to do so.