Households with heating oil are being promised a multi-million pound handout worth an average of £35 each, the government has announced today, in new rules which will allow people to approach their local council for help paying for heating oil.

Following a sudden and crippling increase in the price of heating oil per litre, Prime Minister Sir Keir Starmer held a press conference today in which he announced a package of support targeting the estimated 1.5M households who currently rely on heating oil.

The oil is used primarily by rural communities and is not governed by any kind of price cap, unlike gas and electricity which are governed by energy ombudsman Ofgem.

Today, the price of heating oil per litre is 128.4p, which is up from approximately 57p per litre this time last month, according to energy firm Boiler Juice.

Today, Sir Keir Starmer has announced a package of financial help for households struggling with the soaring cost of heating oil on the back of the conflict in the Middle East.

Following the US-Israeli strikes, volatility in the Middle East – compounded by Iran warning vessels not to pass through the Strait of Hormuz – has led to the price of heating oil at least doubling in the past week alone.

The price of kerosene – the fuel used for heating oil – has been especially affected by the conflict and has risen faster than other fuels such as petrol and gas, largely because distributors hold minimal stocks, leaving them exposed to sudden market volatility.

Unlike gas and electricity customers, Ofgem’s price cap does not cover those who heat their homes with oil, meaning they are exposed to more immediate cost spikes.

Home heating oil is used by around 1.5 million mainly rural households in the UK.

The problem is particularly acute in Northern Ireland, where 62.5% of homes rely on it, compared with the UK average of just more than 5%.

The Prime Minister and the Chancellor have announced that around £50 million will be made available to help low-income families who heat their homes with oil.

Some £17 million has been allocated to Northern Ireland, England will receive £27 million, Scotland £4.6 million and Wales £3.8 million.

Until the end of March, the Household Support Fund will be how the money is given out, and its replacement scheme the Crisis Resilience Fund will be how its distributed instead from April.

The HSF, and its replacement the CRF, allow councils to set their own rules about how to give out the money to individual households. Some ask for proof of hardship, others ask that applicants be on certain benefits or earn below a certain income level.

It means that not everyone will get the money by default, but those who want help with heating oil costs will need to apply to their local council.

The Government said it also intends to introduce new consumer protections for heating oil customers and is “rapidly exploring new ways to step in and ensure households are better protected”.