What Determines Heating Oil Prices?
When it starts to get cold outside, business owners and homeowners dread opening their heating bills and getting the shock of prices that seem to increase each time the temperature drops. Those living in frigid climates must include more money for high heating costs in their budgets for at least six months–from late fall to early spring.
Households and businesses that depend on oil for heating may be surprised to learn what contributes to fluctuating heating oil costs. It’s not just colder weather; other issues influence the price of heating oil. Consider some of the factors that determine crude oil and heating oil prices.
What Determines Heating Oil Prices In Bradley Beach NJ?
In this article, we discuss some factors that influence what you pay for your heating oil.
Crude Oil & The Costs Of Your Heating Oil
Heating oil, like gasoline, is one of the by-products of crude oil. When crude oil prices increase, heating oil prices follow suit. Reduced production or an excess of crude oil on the market can influence crude oil prices. War in an oil-producing country may make it challenging to bring crude oil to market which creates scarcity. Scarcity means that users crude oil by-products will be in competition for those products and that drives up prices.
Political sanctions can also affect crude oil prices. When a leader of a major oil-producing country behaves in ways deemed dangerous to their citizens and the global community, it can lead to sanctions. If other countries impose sanctions and cease purchasing oil from the offending country, that can decrease the available supply and drive up prices. Government regulations can also play a role in higher heating oil costs. When laws prohibit the production of crude oil in certain areas, that increases the need to obtain crude oil from more expensive sources.
The Demand For Fuel Oil & Heating Oil Deliveries
Winter is the peak time for heating oil use, making the demand higher. The price of crude oil is not the only factor that drives up prices when demand is high. There are costs involved with getting heating oil to the homes and businesses that use it. More drivers and more trucks on the road add to the cost of doing business, which can also increase costs for the consumer.
Availability Of Fuel Oil In The Area
In remote or rural areas, there may be a limited number of heating oil suppliers. Delivering heating oil to a home on a steep mountain will require more fuel for the tanker. Transporting heating oil to areas where driving can be dangerous is likely to impact a company’s vehicle insurance costs. In remote areas where heating oil is scarce, it tends to be more expensive because of demand, the effort required to get it to the consumer, and lack of competition.
Seasonality & Heating Oil Prices
Heating oil is a seasonal commodity, so prices fluctuate toward the higher end as the weather becomes colder. For this reason, some business owners and homeowners take advantage of lower prices by having tanks filled before cold weather begins. In places where winter is harsh, this can mean significant savings because it reduces the quantity of heating oil the consumer must purchase when prices spike.
Regional Costs From Oil Distributors
Local heating-oil businesses purchase their supplies from regional distributors. Distributors incur expenses required to transport heating oil to a regional facility and to store it. The cost and overhead of regional heating oil distributors also factor into how much the customer will pay.
Call Point Bay Fuel For All Of Your Heating Oil Requirements
There is no sure way of determining what heating oil prices will be from one season to the next. However, when consumers keep good records, that can help. A consumer can review receipts to look for patterns that show increases. Comparing last season’s price increases with temperatures and world affairs offers an idea of how current events might impact the cost of heating oil.
For all of your heating needs, you should contact Point Bay Fuel. We specialize in fuel oil deliveries and heating system services. By working with us, you can expect fast and friendly deliveries. Also, we offer a variety of oil delivery plans to meet your needs. The oil that we deliver is of high quality and we offer the4 best heating oil prices in the area.
All our NATE certified HVAC contractors are equipped with the knowledge and expertise to correctly and efficiently get the job done. Our HVAC services aim to increase energy efficiency, comfort, and much more. Point Bay Fuel provides a variety of home comfort services. Call us today for further details.
Some of the areas we service include Asbury Park, Avon By The Sea, Bradley Beach, Ocean Grove and these zip codes 07712, 07717, 07720, 07756 as well as all surrounding areas in Monmouth County, New Jersey.
Contact us now by calling (732) 349-5059 to speak to one of our home comfort specialists!