Secretary of State for Energy Security and Net Zero Miatta Fahnbulleh MP has welcomed decisive action by the Competition and Markets Authority that will see hundreds of domestic heating oil customers compensated following unfair order cancellations during wholesale price spikes earlier this year.
The regulator stepped in after an investigation revealed that several suppliers cancelled customer orders placed through an intermediary site following price surges linked to conflict in the Middle East.
Fahnbulleh said:
“Heating oil customers must be treated fairly. I will not tolerate anything else.
“I welcome the CMA’s action to ensure those left out of pocket when the Iran war began get compensation. Suppliers must now ensure they get the money they are owed.”
Protecting rural households and energy consumers
Around 1.5 million households across the UK — particularly in rural off-grid areas — rely on kerosene (heating oil) to warm their homes and supply hot water.
Following market volatility between February and March 2026, average heating oil prices jumped by 64% from 64p a litre to 104p a litre, reaching peaks of 123p a litre in April 2026. The CMA found that during this period of market stress, some suppliers cancelled existing customer orders, leaving consumers facing extra costs estimated between £150 and £350 to buy replacement fuel, or leaving them without essential heating entirely.
Details of the CMA compensation scheme
Under the formal redress scheme secured by the CMA:
- Refunds for replacement fuel: customers who were forced to purchase replacement heating oil at higher prices will receive direct payments covering the price difference between their original cancelled order and the replacement purchase.
- Honouring original contracts: customers whose orders were cancelled but who did not buy alternative fuel will have their original orders honoured at the originally agreed contract price.
- No action needed: around 800 affected customers have already been notified, with suppliers and the regulator contacting remaining eligible consumers directly by phone or email. Those seeking replacement-cost refunds will need to provide evidence of purchase, such as a receipt or delivery note.
Sarah Cardell, chief executive of the CMA, said heating oil is a necessity for households and that suppliers had now agreed to put it right by issuing compensation or honouring original contracts.
The action underlines the government’s stance on consumer protection, ensuring energy markets treat consumers fairly and holding suppliers accountable.
