Residential Heating Oil Price Fluctuation Explained

Though the bulk of the residential heating market has switched to natural gas in most regions of the United States, approximately 8.1 million of the 107 million homes continue to use heating oil as their main source to heat their homes. Of this 8.1 million, nearly 82% of these homes are located in the Northeast region of the United States, and these homeowners are extremely interested in the foreign and domestic oil market because it can really affect their wallets and pocketbooks in the frigid months of late October through March.

Many variables influence the rise and fall of the price of heating oil. One of the largest of these is demand. During the winter months, more oil is needed by consumers, and the price increases. Many homeowners try to beat the system by filing their storage tanks at the lower prices of summer, but few own tanks large enough to get them through the winter months. Most homeowners must have their tanks filled and refilled up to five times during the course of one New England winter, so higher prices can make for a lean holiday season. A typical homeowner in the Northeastern United State might use 650-1000 gallons of heating oil during the winter months. Another contributing factor in the price of heating oil is, of course, the price of crude oil, also influenced by supply and demand. In some areas, several suppliers compete for their share of the residential heating oil market. This competition can often result in higher prices as well. A final factor that affects the price of heating oil is operating costs. In more remote areas, the transporting of the fuel to inhabitants can be much more costly, resulting in higher prices for those consumers. These operating costs are affected by employee wages, equipment costs, lease or rent for the dealer, etc. All of these factors are present when the monthly bill reaches the homeowner.

There exist many ways to lower heating bills in the depths of winter. The easiest can be achieved by the homeowner him or herself, simply by winterizing the home. Proper insulation within the walls of the house combined with energy efficient windows and adequate caulking and weather stripping around them can result in a much more cozy abode that requires less heat to be comfortable for its inhabitants. Budget plans also exist with most dealers to help spread the cost of heating during the winter months across the entire year of bills. Though consumers cannot do anything to influence the price of oil directly, by taking proper precautions at home to conserve their energy, they can be less affected by inevitable price changes.

About the Author: Robert Jent is the president of Triple Diamond Energy Corp. Triple Diamond Energy specializes in acquiring the highest quality prime oil and gas properties. For more information, visit http://www.triplediamondenergycorp.blogspot.com.