How A Heating Oil Quote Is Calculated

PRLog (Press Release) – Oct 08, 2009 – The refinery - Each refinery has its own cost of production. The refinery running costs and their overheads, such as staff wages etc, all have an impact on what they can sell a litre of oil for.

The cost of moving the heating oil from the refinery to the supplier - Heating oil suppliers usually buy in bulk. This can come in the form of an articulated tanker load or even sometimes a canal barge load!

The cost of the heating oil will vary depending on which supplier they buy it from. They may have preferential agreements with certain refineries.

There is also the cost of the transport of the fuel from the refinery to the oil suppliers storage facilities. If the refinery is close by, the haulage cost will only have a small impact on the cost of the oil. If the refinery is far away, then the haulage charge will be larger and so there will be a greater impact on the cost per litre of heating oil.

The costs of running the business and the delivery vehicle - The next cost which is added to heating oil price is that of running the oil supplier's business. Their overheads include, wages, rent, heating, light etc. There is also the cost of getting the heating oil from the supplier to your home. An oil supplier usually has an approximate pence per litre figure that they work to for delivery.

The supplier's profit – Another addition to the cost of your heating oil is the supplier's profit. Domestic oil suppliers will usually try and work to an approximate margin, where they can be competitive in the market place for the customer, while meeting the performance expectations placed on them by internal and external shareholders. This could be the owner, board or even the bank!

VAT - The VAT on kerosene home heating oil is 5%. This is the added cost which goes to the tax man.

The total – The sum of all these costs gives you the price you pay for your heating oil when you get a quote from your supplier.

For more information please visit www.heatingoil.co.uk

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Heatingoil.co.uk is an online only heating oil company which supplies Kerosene, Gas Oil and CBK to Northern England and North Wales.

The company has been trading since 2007 and is now one of the largest online suppliers of heating oil in the UK.

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• Meg Ryan
• Sarah Michelle Gellar