Posted on 17 December 2010.
A heating oil shortage in the United Kingdom reportedly has the government considering a rationing plan to get families through the winter.
Severe winter storms and inflated prices have been hitting U.K. heating oil users hard in recent weeks. An estimated 660,000 households, schools, hospitals, and other buildings without access to gas supplies are looking at a three- to four-week waiting period before they receive more fuel.
U.K. energy minister Charles Hendry said the situation could become “very serious indeed” if the fierce winter weather continues, SkyNews reported Friday.
Labour Member of Parliament Tom Watson went so far as to describe the situation as “an oil supply crisis.”
But despite reports that Mr. Hendry met with the oil supply industry to discuss the possibility of rationing, ministers say there are no plans to implement heating oil restrictions.
SkyNews quoted the Department of Energy and Climate Change as saying: “We are categorically not planning to introduce rationing of oil. Not now. Not in the near future. It’s not on the cards.”
Still, while members of Parliament didn’t use the word “rationing,” some observers believe that the subtext was there.
After all, on Thursday Energy Secretary Chris Huhne said the government was “attempting to ensure that people don’t have too much so there is enough to go around.”
On Friday the government announced its plans to relax laws for delivery drivers, giving them an extra hour to transport the much-needed oil to homeowners and businesses.
Meanwhile, oil prices edged up Friday on the New York Mercantile Exchange as the Republican-backed tax cut package made its way to President Barack Obama’s desk.
Investors hope that the bill, which seeks to prolong Bush-era tax cuts and extend jobless benefits, will stimulate the economy and raise consumer demand for oil.
Benchmark oil for January delivery was up 34 cents to $88.04 a barrel in midday trading, The Associated Press reported.
Heating oil rose 0.82 cent to $2.4845 a gallon, gasoline futures rose 2.65 cents at $2.3308 a gallon, and natural gas added 1 cent at $4.058 per 1,000 cubic feet, AP said.
The tax breaks implemented during George W. Bush’s presidency have a Jan. 1 expiration date, and the new measure would extend the cuts an additional two years. The bill would also enact a break in Social Security taxes and prolong a series of business tax cuts in an effort to promote investment.