The price of oil has skyrocketed by 76 percent over the past year, meaning that many homeowners in Switzerland will have to dig much deeper into their pockets to heat their homes during winter.
This price surge will affect a very high number of households, as oil is the primary source of heating in Switzerland: according to the Federal Statistical Office, 33 percent of homes across the country rely on this energy source, compared to 25 percent for heat pumps, followed by gas (17 percent), wood (12), and electricity (7).
A litre of heating oil currently costs around 1.65 francs, depending on the quantity ordered.
Within just two months, the price has risen by roughly 40 to 50 percent.
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Why is that?
Just as is the case for petrol, the price surge is due to both geo-political and environmental causes.
On the political front, it is …fuelled by geopolitical tensions in the Middle East – concretely, the continued conflict between the US and Iran.
Another reason, falling under the ‘environmental’ category – is the lingering effect of this summer’s drought, which has caused the water level in the Rhine river to drop, so fewer tankers can transport petroleum products – including oil – from the North Sea ports to Basel.
According to Andreas Flütsch, CEO of Migrol AG, “High transport costs, the geopolitical situation, and the difficult conditions in international energy and refining markets continue to exert significant price pressure.”
The waiting game
Faced with such a sharp price increase, many households in Switzerland are currently holding off on purchasing heating oil, hoping for prices to drop.
But “If everyone waits to buy heating oil until the last minute, and all orders are placed at the same time, delivery delays could occur,” said Ueli Bamert, a spokesperson for Swissoil.
However, with the weather becoming cooler and winter not that far off, the ‘wait-and-see’ stance is not the best strategy, experts say- especially as prices are not likely to drop before this winter anyway.
“Based on current conditions, we anticipate persistently high prices rather than any easing of the situation,” Flütsch pointed out.
The higher heating costs will hit homeowners hard, but what if you are a tenant?
Whether or not the landlord will pass these higher prices on to you depends on your rental agreement.
Under Swiss tenancy law, billing for heating and other ancillary costs must be included into the contract.
If it does not mention these charges, it means that they are already included in the rent.
In most cases, however, heating and hot water costs are billed separately; if that is your case, then you will be responsible – at least partly – for staying warm this winter.
