Home Heating Oil
 

I'm caught on the horns of a dilema. Trapped between a rock and a hard place. :confused: Do I "lock in" with a Big Oil conglomerate at around $2.83/gal for the winter, or continue to shop around for the lowest cash price ($2.23/gallon today) and gamble that home heating oil won't make it to $3.00+ this winter?

I locked in till May at 2.54 a gallon. Just got a full tank that cost $500.
Ouch......

I had the chance to do the same back then, but I gambled and lost. the question is, what do I do NOW?

I took advantage of locking in for a season a couple years ago. the only problem was the oil company kept coming by to fill my tank, like every week. I usually order when I need 150 gallons. not 10 or 20 gallons. I was constantly getting a bill from them.then when the prices went down in march they wouldn't match the price, they tried to tell me I had to pay the locked in price until may. I'd get a full explanation. I caved in to my father in law and his doom and gloom speech. never again. :mad:

I've been locking in with a contract price for the last 2 years and it paid off in the long run. (Did I just answer my own question?). It seems that the lock in price is quite a bit higher than the cash price at the time of the lock-in but by the time a year goes by the contract price is lower. I hear what your saying though about unwanted deliveries.

Posted price: The "pump" price that fluctuates with NYMEX heating oil futures. If you are a variable price customer, usually you get a slight discount (say, a nickel a gallon) off of the variable price per gallon. If you know that prices aren't going to go up or will drop sharply, this is the way to go.

Cap price: Price goes NO HIGHER than a pre-determined price (say, $2.199/gal) throughout the season. If the "posted" or variable price drops below the cap, then your price follows the posted down accordingly. If you expect a sharp rise in heating oil prices, this is your best bet at upside protection.

Fix price: "locked in" price per gallon that says the same for the entire season. Usually, your h.o. company will obligate you to buy x number of gallons. If prices go down, you could get screwed on a fixed price contract, as you are obligated to buy x gallons at x price.

Rule of thumb for New England residents: the average New England home burns 1,100 gallons of heating oil a year, and usually gets something like 5 deliveries.

A warmer than average winter DOES NOT NECESSARILY MEAN PRICES WILL GO DOWN. A COLDER THAN AVERAGE WINTER VIRTUALLY GUARANTEES THAT PRICES WILL GO UP.

Now all I have to do is find a company that offers a cap price. Mine only offers a fixed.

We locked in at 2.69, higer than I wanted, but it includes the yearly maintenance to the boiler, and makes it easier to budget.

Just called for a delivery for tomorrow at 2.00/gal. Tank at 5/8 full but want to keep it up. Gary at Boston Fuel in Everett I believe has been VERY good to us. His cash price was always lower than what I expected last winter.

My propane company showed up last week
$3.50 a gal for propane to heat my garage!!!
I have natural gas in my house, who knows how high that will be !!!

$2.57 :crying:

Got a delivery from Petro 2 weeks ago $2.79. feels like I have been "violated"

:laughs: That's cuz the parent company (see ticker SGU) is teetering on the brink of financial collapse. :sick:

Petro charged me 2.59 yesterday. The cheapest local "Little Guy" was 2.23 yesterday. Petro's contract price was 2.83 yesterday. If the reports that the Little Guy cash delivery prices will exceed 3 or even 4 dollars/gallon this winter are true, perhaps a lock-in in the 2.80s is cost effective. I suspect that the big conglomerates like Petro are behind these "reports". Gas was "predicted" to go over $3.00/gallon after Rita and as we know, not only did this not happen, it actually went down.