Berlin.
Heating oil prices have been on a downward trend since January 4th. There are mutliple reasons for this. What the development means for consumers.
The war in Ukraine and the resulting gas conflict with Russia has Germany energy prices have risen massively. Heating oil and gas have risen massively in price in 2022 – at times a liter cost more than 1.65 euros. In the meantime, the energy market has calmed down a bit and the traffic light coalition has initiated a subsidy for heating oil and wood pellets. The goal: Like electricity and gas customers, pellet and heating oil customers should be relieved of the burden on the state coffers.
Heating oil prices on a downward trend: price per liter falls below the 1.20 mark
In contrast to the electricity and gas price brake from March, the subsidy for heating oil and wood pellets should only be paid out on application. In addition, they have to Pellet and fuel oil customers meet certain requirements – unlike the electricity and gas price brake, their relief does not come automatically. The fear is that many consumers will not benefit at all from the pellet and heating oil subsidy and will get nothing – all the more gratifying is a look at the development of heating oil prices in Germany. It’s been going down since January 4th.
As of January 5, a liter of heating oil costs 1.15 euros according to information from “esyoil” – yesterday the comparison portal reported a liter price of 1.17 euros. “TotalEnergies” and “Tecson” have also reported slightly falling heating oil prices since January 4th. It has been several weeks since such a strong downward trend was recognizable – on the contrary: since the end of December, the heating oil prices leveled off at just over 1.20 euros. Several comparison portals are currently reporting on the possible reasons for the development.
| date | Heating oil price per liter |
|
January 1st |
1.23 euros |
|
January 2nd |
1.22 euros |
|
January 3rd |
1.20 euros |
|
January 4th |
1.15 euros |
|
January 5th |
1.14 euros |
Source: esyoil (as of January 5; 5:15 p.m.)
Heating oil prices are falling: Crude oil prices and interest rates – the reasons for the fall in prices
The online portal “HeizOel24” calls the sinking crude oil prices as a factor. In an interview with our editorial team, Managing Director Oliver Klapschus already emphasized that the price of crude oil plays a decisive role in pricing. “The product price accounts for around 60 percent – plus 30 percent taxes and duties and around 10 percent for trade and logistics.” Crude oil prices, in turn, are strongly determined by the current situation on the world market.
According to reports from “HeizOel24”, the announcement of the European Central Bank (ECB) on upcoming key interest rate adjustments had a positive effect on prices on the stock exchange. Crude oil is traded in dollars on the stock exchange. The dollar has recently increased in value due to the interest rate hike in the USA – this tends to make oil imports more expensive. Rising interest rates in the EU would strengthen the euro again and, conversely, make imports cheaper again. The ECB announcement could therefore be partly responsible for the positive development in heating oil prices.
Heating oil prices flying low: Expert classifies development – what consumers should know
Market analyst Steffen Bukold from “esyoil” defines another reason: the falling gas price. The price of gas is also flying low and has fallen below the pre-war level. Bukold: “Meteorologists are expecting unusually mild weather in the coming weeks.” That in turn will keep gas and heating oil prices in check. Supply and demand determine the prices – this is no different with heating oil and gas. In addition, with a view to demand, oil demand is also weaker in China due to the corona.
The Chinese demand in turn pushes the international prices, report the experts from “HeizOel24”. It remains to be seen how the new EU sanctions on oil product deliveries by ship from Russia and the production cuts from Russia will affect international pricing and thus also national prices heating oil prices could affect. The year 2022 has shown how quickly and unexpectedly the prices of energy products can change overnight.
Heating oil prices: Forecast, subsidies & grants – that’s what consumers will have to face in 2023
Nevertheless, Klapschus predicts that heating oil prices in Germany will tend to fall in 2023. In an interview with our editors, he mentioned a liter price of 1.10 euros as a guide: “But that’s all speculative.” Factors that are difficult to calculate, such as the war in Ukraine or the weather, are difficult to assess in the calculation. This is also why analysts warn despite falling energy prices from too much euphoria. Bukold: “Nothing is cheaper than fuel oil that is not burned.”
His appeal to consumers: As before, you should reduce your consumption if possible and reconsider your heating behavior. It can also make sense to think about replacing an older oil heating system. In 2023 there are several state subsidies for a new heating system. The CSU go the existing grants not far enough. In a decision paper, the Bavarian party calls for a “special bonus” for replacing old oil heaters. However, it is unclear to what extent they can assert themselves with these demands.
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