The Competition and Markets Authority’s heating oil market study is not only a household energy story. It should also matter to rural small firms that rely on oil for premises, workshops, farm offices, hospitality sites or other off-grid buildings.
The CMA launched its study into the retail supply of heating oil in March and has now published responses to its statement of scope. A final report is expected in June 2026, with a statutory deadline in March 2027. The study is formally focused on domestic heating oil, but the published response from the Federation of Small Businesses argues that small business users should not be overlooked.
That is a useful reminder for SMEs because heating oil can behave differently from more familiar energy bills. Prices can move quickly, deliveries may be seasonal, and smaller organisations often have less bargaining power than large commercial buyers. For a rural business, a badly timed price spike or delayed delivery can hit cash flow just as sharply as a higher electricity tariff.
Why small firms are part of the picture
In its response to the CMA, the FSB said around 7% of small businesses use heating oil, rising to 17% among rural small firms and falling to 2% among urban firms. That makes the issue especially relevant for village shops, rural workshops, small manufacturers, farm-based businesses, visitor accommodation, independent hospitality venues and service firms operating from off-grid premises.
The FSB’s concern is that many smaller business users can look more like household customers than large commercial energy buyers. They may buy more than a domestic household, but still lack procurement teams, real-time market insight or the ability to spread risk across multiple sites. That can leave owners exposed to unclear pricing, unfavourable contract terms or short-notice replacement costs if an order is cancelled or delayed.
The CMA page shows responses from consumer bodies, suppliers, industry groups and the FSB. For SME owners, the important point is not to predict the regulator’s final conclusions, but to use the review as a prompt to tighten energy-cost visibility before next winter.
What the CMA is looking at
The CMA says it launched the market study into the retail supply of heating oil for domestic use in the UK and aims to publish its final report within three months of launch. The responses published on 29 April show a range of concerns and evidence from across the market.
For small businesses, the themes worth watching are price transparency, delivery reliability, contract fairness and the ability to compare suppliers. These are practical issues rather than abstract policy questions. If a business cannot understand the price being offered, cannot rely on delivery dates, or has little remedy when an order changes, planning becomes harder.
That planning challenge sits alongside wider running-cost pressure. BritishSME has previously covered why fuel duty uncertainty matters for small businesses with transport and delivery costs. Heating oil is a different market, but the management lesson is similar: firms need a clearer view of volatile energy costs before those costs become urgent.
What rural SMEs should check now
First, review how exposed the business is. List which buildings, activities or customer services depend on heating oil, then check annual usage, tank capacity, supplier history and the months when demand usually peaks. If the oil bill is buried inside general premises costs, separate it out.
Second, compare how quotes are obtained. Owners should know whether prices are being checked against more than one supplier, whether delivery charges are clear, and whether any minimum-order or cancellation terms could create a cash-flow problem. A small amount of admin now can prevent a rushed purchase later.
Third, check the contract and paperwork. If the business has a regular supply arrangement, look for clauses covering delivery windows, cancellation, price changes, payment deadlines and what happens if supply is disrupted. If the business buys ad hoc, keep records of quotes, order confirmations and delivery notes so price movements are easier to evidence.
Fourth, build heating oil into the cash-flow forecast. A single fill can be a large bill for a small premises-based business. That links directly to wider working-capital strain, including the late-payment pressures discussed in our article on late payments and UK SMEs.
What to watch next
The CMA’s final report, expected in June 2026, will be the key next step. It may not produce immediate changes for every business customer, but it should clarify whether the market is working well and where improvements may be needed.
For rural SMEs, the sensible response is to treat the study as an early warning. If heating oil is material to keeping premises open, staff comfortable or customers served, it deserves the same attention as wages, rent, card fees and vehicle costs. The businesses that know their usage, contracts and supplier options before prices move are likely to be in a stronger position than those forced to make decisions when the tank is already low.
Sources: Competition and Markets Authority; Federation of Small Businesses response to the CMA heating oil market study.
