Oil vs Gas Boiler: Which Is Cheaper to Run in the UK?
If you can connect to mains gas, gas is usually cheaper to run than oil at 2026 prices. Oil mainly enters the picture for the roughly 1 in 7 UK homes with no gas connection — and even then the real contest is oil vs LPG vs a heat pump. Here is the honest 2026 cost breakdown, including a 10-year total-cost model that most comparison pages skip.
Quick answer
At mid-2026 prices, mains gas is usually cheaper to run than oil. Gas costs 7.33p per kWh under the Ofgem price cap (July–September 2026, including VAT), while heating oil works out at roughly 7–9p per kWh at typical recent prices of about 74–95p per litre. Because oil prices are volatile — they topped 130p per litre in spring 2026 — the gap widens or narrows with the oil market. For a home on the gas grid, gas also wins on install cost and servicing cost.
Oil's one structural advantage is no standing charge — you only pay for the fuel you buy, while gas carries a fixed standing charge of about £106 a year (29.04p per day). That narrows the gap for very low-usage homes but rarely closes it. If you are off the gas grid, the smarter comparison is oil against LPG and a heat pump, not oil against gas. These are indicative UK figures last checked in 2026 — confirm current rates with your supplier.
Oil vs gas boiler: the quick verdict
For most UK homes on the gas grid, the answer is straightforward at 2026 prices. If your street has a mains gas connection, a gas boiler is usually cheaper to run, and is cheaper to install and to service, than an oil boiler.
Oil heating exists because around one in seven UK homes — mostly rural and off-grid — has no gas main at all. For those households, oil has been the default. But it is no longer the obvious choice.
The honest take: on the grid, gas usually beats oil on cost — though oil's price swings mean the running-cost gap moves around. If you are off-grid, do not compare oil to gas (you cannot have gas) — compare oil to a heat pump and LPG instead. This page is general information, not personalised advice.
Running cost head-to-head: price per kWh (2026)
The fairest way to compare two fuels is cost per kilowatt-hour (kWh) of heat. Here is where the two stand in 2026.
- Mains gas: 7.33p per kWh under the Ofgem price cap (July–September 2026 average for direct debit, VAT included).
- Heating oil (kerosene): roughly 7–9p per kWh at typical mid-2026 prices of about 74–95p per litre (kerosene holds about 10.35 kWh per litre).
On unit cost alone, gas is usually a little cheaper at mid-2026 prices — but heating oil is highly volatile. It climbed above 130p per litre in spring 2026 (which would push oil past 12p per kWh) before falling back over the summer. When oil spikes, the gap widens sharply in gas's favour; when oil is cheap and bought well, the two can run close.
There is one nuance oil suppliers rightly highlight. Oil is bought in bulk, so timing and order size matter. Buy a full 1,000-litre tank in summer when prices dip and your effective rate can fall to around 7p/kWh or a little below; top up small amounts in a cold snap and you pay the premium. Gas has no such control — you pay the capped rate as you burn it.
What you'll actually pay per year
Per-kWh figures are abstract. Here is what a real whole-house heating bill looks like. A typical 3–4 bedroom home burns roughly 11,500–12,000 kWh of gas heat a year, and an off-grid oil home of similar size commonly buys around 1,500–2,000 litres of oil.
- Gas: ~12,000 kWh × 7.33p = about £880 in fuel, plus the gas standing charge of 29.04p/day ≈ £106 a year. Total ≈ £986.
- Oil: ~1,500–2,000 litres at 74–95p/litre = about £1,100–£1,900 in fuel, with no standing charge.
So in a normal year at mid-2026 prices, gas comes out ahead even after its standing charge — though a cold winter with high oil prices and a poorly timed top-up can push an oil home well above this.
This is the detail competitors skip: gas's fixed £106 standing charge is paid whether you heat or not. For a tiny, lightly heated home, that fixed cost narrows the gap — but it rarely flips the result. Want to push your gas bill lower? See ways to reduce your gas bill and the cost of running gas central heating per hour.
Side-by-side comparison table
| Factor | Mains gas boiler | Oil boiler |
|---|---|---|
| Fuel cost (per kWh) | 7.33p (capped) | ~7–9p (volatile; spiked above 12p in spring 2026) |
| Standing charge | ~£106/yr (29.04p/day) | None |
| Typical annual fuel bill | ~£880–£1,000 | ~£1,100–£1,900 |
| Efficiency (modern, ErP) | ~90–94% | ~90–93% |
| Typical lifespan | 10–15 years | 15–25 years |
| Install (supply + fit) | £1,800–£2,800 (combi) | £3,500–£5,500 (+ tank) |
| Annual service | £70–£120 | £100–£200 (~£140) |
| Qualified engineer | Gas Safe registered | OFTEC registered |
Figures are indicative UK 2026 ranges; your own quotes will vary by region, home, oil price and provider.
Installation cost: oil vs gas
Upfront, gas is cheaper. A mid-range gas combi boiler supplied and fitted typically lands at £1,800–£2,800, with the full range running roughly £1,200–£4,000 depending on complexity. See our full guide to boiler installation costs.
An oil boiler costs more to install — typically £3,500–£5,500 for a full replacement. Oil systems are more complex, and the rules around fuel storage are stricter.
There is also the tank. Replacing or upgrading an oil storage tank to current OFTEC standards can add £1,000–£2,500 on top. Gas boilers must be fitted by a Gas Safe registered engineer; oil boilers by an OFTEC registered technician.
Servicing and maintenance cost
An annual service keeps any boiler safe, efficient and (usually) warranty-valid. Oil costs noticeably more here.
- Gas service: typically £70–£120 (more in London and the South East).
- Oil service: typically £100–£200, averaging around £140 — roughly 30–50% more than gas.
Oil costs more because the job is bigger: oil boilers run dirtier, so the engineer usually fits a new nozzle and supply hose, cleans more components, and checks the tank and fuel line as well as the boiler. See our guide to boiler service costs for what's included.
Efficiency: are modern oil and gas boilers as efficient?
Both are excellent. A modern condensing gas boiler runs at around 90–94% ErP efficiency, and a modern condensing oil boiler is close behind at roughly 90–93%.
In practice, efficiency is not the deciding factor between the two — the fuel price gap matters far more. A 93%-efficient oil boiler burning fuel at 9p/kWh still costs more to run than a 92%-efficient gas boiler burning fuel at 7.33p/kWh.
Boiler lifespan: which lasts longer?
Oil tends to win on longevity. A well-maintained oil boiler can last 15–25 years, while a typical gas boiler is usually replaced at 10–15 years.
That longer life partly offsets oil's higher install cost when spread over the years — though it does not offset the higher annual fuel and service bills in most years. See average boiler lifespan by brand for the detail.
10-year total cost of ownership
One per-kWh number is not enough. Here is what actually leaves your bank account over a decade — fuel, servicing and a share of one new install — for that same typical home. These are illustrative figures, not a quote.
| Cost over 10 years | Gas | Oil |
|---|---|---|
| Fuel (incl. standing charge) | ~£9,800 | ~£12,000–£18,000 |
| Annual servicing (×10) | ~£950 | ~£1,400 |
| Boiler install (apportioned) | ~£2,300 | ~£4,000 + tank |
| Approx 10-year total | ~£13,000 | ~£17,000–£24,000 |
Even crediting oil's longer boiler life and no standing charge, gas typically comes out several thousand pounds cheaper over a decade for a grid-connected home — assuming oil prices and the cap stay in their recent ranges. Your numbers depend on usage, oil prices and the deals you secure.
Boiler cover and insurance: oil vs gas
This is where oil hits another snag that few comparisons mention. Boiler breakdown cover is generally cheaper and easier to find for gas.
Basic gas boiler-only cover typically starts from around £8–£13 a month, with comprehensive heating-and-home cover going higher. Most providers — including the big names — build their plans around gas boilers.
Oil and LPG boilers are a different story: fewer providers offer cover, and where they do it tends to cost more, reflecting the smaller market and specialist OFTEC call-outs. If you heat with oil, see our dedicated guide to oil and LPG boiler cover to compare your options.
Please note: we compare a selected panel of cover providers, not the whole market, and may earn a commission if you buy through our links. Some products are FCA-regulated insurance; others are unregulated service or care plans — a service plan is not insurance. Prices are indicative "from" figures, last checked in 2026 — always confirm the current price and terms on the provider's own page.
Off-grid reality: if you can't get mains gas
If there is no gas main, comparing oil to gas is academic — you cannot choose gas. The genuine decision is between oil, LPG and a heat pump.
- Oil: high heat output, cheaper to install than a heat pump, but needs a storage tank and a volatile fuel price.
- LPG: behaves much like mains gas at the boiler, but is delivered by tanker to a bulk tank or supplied in bottles, and its unit cost is typically higher than oil or mains gas.
- Heat pump: highest upfront cost but lowest running cost long term, and eligible for the Boiler Upgrade Scheme grant.
The grant matters most for off-grid homes. The Boiler Upgrade Scheme gives £7,500 towards a heat pump in England and Wales, and from 21 July 2026 there is a temporary uplift to £9,000 for off-gas-grid homes currently heated by oil or LPG (check current eligibility, as the uplift is time-limited). For off-grid homes, a heat pump plus the grant is increasingly the cost-competitive long-term option. Compare the running costs in our heat pump vs gas boiler guide. If you're weighing an all-electric system, also see electric vs gas boiler running costs.
The oil boiler ban and the future of fossil heating
There is a lot of confusion here, so to be clear: you do not have to rip out a working oil boiler. Existing oil boilers can stay, be repaired and be refuelled.
Government policy is moving toward phasing out new fossil-fuel heating installations over the coming years, with the broad direction pointing toward 2035 rather than a sudden ban. New-build homes are already moving away from gas and oil under the Future Homes Standard.
The practical takeaway: if your oil boiler works, keep and service it. When it finally fails, that is the moment to weigh a low-carbon replacement. Read more in our guide to the future of gas boilers.
Can you switch from oil to gas?
Only if a mains gas connection is available at or near your property. If it is, switching can lower your running costs — but the conversion is not cheap.
You would pay for a new gas connection (often four figures, depending on distance to the main), a new gas boiler and pipework, plus removal or decommissioning of the old oil tank. Whether that pays back depends on your usage and how long you plan to stay.
If gas is not available, switching to gas is simply not an option — which loops back to the off-grid comparison above (oil vs LPG vs heat pump).
Which should you choose?
A quick decision guide:
- You can get mains gas: gas is usually your cheapest option to run, install and service. Gas is the strong default.
- You're off-grid and replacing soon: compare a heat pump (with the grant, including the off-grid uplift) against oil and LPG — don't default to oil out of habit.
- You're off-grid with a working oil boiler: keep and service it; plan a low-carbon swap for when it dies.
- You burn very little heat: oil's lack of a standing charge helps, but gas usually still wins overall.
This page is general information, not financial or gas-safety advice, and not a personal recommendation. Always get quotes from a Gas Safe (gas) or OFTEC (oil) registered engineer for your specific home.
Safety first: any work on the gas supply, burner, flue, gas valve, PCB, sealed circuit or pressure-relief valve must be done by a Gas Safe registered engineer (or an OFTEC registered technician for oil). Never attempt this work yourself. If you smell gas or suspect carbon monoxide, call the National Gas Emergency line on 0800 111 999.
Is oil cheaper than gas to run?
Usually not, at mid-2026 prices. Mains gas is capped at 7.33p per kWh (July–September 2026, VAT included), while heating oil works out at roughly 7–9p per kWh at typical recent prices of 74–95p per litre — so gas tends to be a little cheaper for homes on the gas grid. Oil is volatile, though: it spiked above 130p per litre in spring 2026, which widens the gap further in gas's favour. Oil's only structural cost advantage is no standing charge, whereas gas carries a fixed charge of about £106 a year.
Which lasts longer, an oil or gas boiler?
Oil boilers tend to last longer — typically 15–25 years with good maintenance, compared with around 10–15 years for a gas boiler. This longer life partly offsets oil's higher install cost, but not its higher annual fuel and servicing bills in most years.
Are oil boilers being banned in the UK?
You will not be forced to remove a working oil boiler, and conventional heating oil will remain available for existing systems. Government policy is moving to phase out new fossil-fuel heating installations over the coming years, broadly pointing toward 2035, with new-build homes moving away from gas and oil sooner under the Future Homes Standard.
Can I switch from oil to gas?
Only if a mains gas connection is available at or near your property. If it is, you would pay for a new gas connection, a new boiler and pipework, plus oil-tank removal. If there is no gas main, switching to gas isn't possible — your realistic options are oil, LPG or a heat pump.
Why are oil boilers more expensive to service?
Oil boilers run dirtier and are more complex, so a service usually includes a new nozzle and supply hose, more cleaning, and checks on the oil tank and fuel line as well as the boiler. An oil service typically costs £100–£200 (around £140) versus £70–£120 for gas. Oil work must be done by an OFTEC registered technician.
Do oil boilers need a Gas Safe engineer?
No. Oil boilers should be installed and serviced by an OFTEC registered technician, which is the oil equivalent of a Gas Safe registered engineer. Gas boilers must be worked on by a Gas Safe registered engineer. Never let an unqualified person work on either fuel system.
How much oil does a typical house use per year?
A typical 3–4 bedroom home commonly buys around 1,500–2,000 litres of heating oil a year (kerosene holds about 10.35 kWh per litre). At mid-2026 prices of around 74–95p per litre, that works out to roughly £1,100–£1,900 in fuel, with no standing charge to add — though usage and prices vary widely.
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Compare boiler coverThis article is general information, not financial or gas-safety advice. We compare a selected panel of providers, not the whole market, and may earn a commission if you buy through our links. Always have gas appliances checked and repaired by a Gas Safe registered engineer; in a gas emergency call 0800 111 999. Prices are indicative UK guides for 2026 — confirm current prices on the provider's own site.