Homeowners and business owners know that heating oil prices do not remain the same price all year round. What you pay one heating season can be completely different the following season. Heating oil prices are constantly going up and down.
As a consumer, you might want answers as to why this is so. There are many reasons for this. Essentially, there are different factors that cause changes in the price of heating oil. In this article, you will find some of the factors that cause the fluctuations in heating oil prices Brick NJ.
Primary Factors That Impact Your Heating Oil Prices
Below, you will find some of the factors that influence what you pay for your heating oil from one season to the next.
Price Of Crude Oil
There is a strong connection between the price of crude oil in the international market and the price of heating oil. The US Energy Information Administration (EIA) states that the price of crude oil is a huge factor in the price of heating oil. From the winter of 2006/7 through the winter of 2016/17 crude oil accounted for approximately 55% of the price of a gallon of oil. 1 This is one reason why crude oil prices will always affect fuel oil prices. Other factors that affect the price of crude oil include crude oil supply from oil-producing countries and industrial demand from countries that use oil to power their industries. Political developments in oil-producing countries also have a significant impact on crude oil prices.
Heating oil prices usually go up when the weather is extremely cold. The winter of 2013/14 was one of the coldest winters in recent history. During this winter, heating oil prices rose by seven cents per gallon. In addition, severe weather conditions like hurricanes and tropical storms cause the price of fuel oil to rise. One reason is that a tropical storm brings low temperatures and this leads to an increase in the demand for heating oil.
Closely connected to this is the fact that severe weather makes it difficult for oil suppliers to deliver products to customers. In some cases, suppliers may run out of oil supplies. This will lead to scarcity and the scarcity will lead to very high prices for both crude oil and heating oil. The EIA says that fuel oil suppliers in some parts of the US might have to buy from Europe or elsewhere if they experience an oil shortage. It makes sense that heating oil from these distant sources will cost more due to logistical reasons.
The price of oil is affected by government policies. This means that the price may rise or fall depending on the policy implemented by regulatory agencies. For instance, if refineries expect a decline in the demand for fuel, the prices may rise because the refineries are likely to scale down production. If policy changes take place in the warm summer months, prices may fall because the refineries have huge inventories at this time.
Your location has an impact on the price you pay for heating oil. If you live in an area with many suppliers of this product, you will pay less for heating oil. On the other hand, if you live in an area with relatively few suppliers of heating oil, you will pay more for the product. You are also likely to pay less for heating oil if you live near a refinery or a major oil-producing company. In effect, the price of heating oil is affected by location or proximity to the product.
Alternative Heating Options
The alternatives to heating oil also cause fluctuations in the price of this product. Alternatives to heating oil include electricity, fireplaces, natural gas, and kerosene. However, unlike heating oil, these alternatives have safety, efficiency, and affordability limitations.
Some of the factors that cause fluctuations in the price of heating oil are weather, crude oil prices, heating options, and changes in policy and regulations.
For The Best Heating Oil Prices In Brick NJ, Call Point Bay Fuel
Point Bay Fuel offers reliable and trusted fuel oil deliveries in Ocean and Monmouth Counties, New Jersey. We offer different oil delivery plans and financing options. This way, you can customize your fuel deliveries to meet your needs. You can expect us to deliver your heating oil on time, every time. Best of all, you can expect reasonable home heating oil prices.
Not only do we deliver high-quality fuel in a friendly and professional manner, but we can also maintain and service your heating system. This will ensure that it performs efficiently this winter. By using our affordable fuel delivery and our heating system services, you can reduce your energy costs while increasing your comfort this winter. Call Point Bay Fuel today to speak to one of our home comfort specialists.
1. Heating Oil Explained ↩