High Heating Oil Concerns
November 20, 2007
It may end up being a very cold winter for some consumers this year. Oil prices are tickling the $100 a barrel mark and with that comes higher heating oil prices. For some people, the increase in heating oil will mean no heat or a much reduced comfort level when the colder temperatures finally hit them. Already, heating oil prices have set new high records, often on a daily basis.
A reliable gauge of how heating oil prices will do is the wholesale future markets in New York. Recently the price of a single gallon of heating oil rose to a whooping $2.62. This is an increase of fifty percent over a year ago. What has taken many people by surprise is how fast the increase happened.
It is true that only about seven percent of the households in America use heating oil as their main source of heating fuel, but that number is concentrated in certain regions of the US. For example, in the Northeastern states approximately thirty-two percent of homes use heating oil, also known as red diesel. If you look closer, you discover that about eighty percent of those living in the state of Maine use this type of fuel oil. That equates to a lot of people, and this is especially true for those who live in older homes.
Recently, the U.S. Energy Information Administration reported that households in the Northeast will pay a record-breaking $3.06 per gallon for heating oil this winter. That is a full 66 cents more per gallon than last year.
Last year, on average, homeowners in that region paid $1,200 for heating. This year it is estimated they will pay $1,880 for the season