Heating oil is simply a form of petroleum that is used by many for warming their homes. In fact, almost nine million homes in the US alone consume lots of fuel. If you’ve paid attention to the prices of oil over the years you would know that the prices tend to fluctuate every year, especially as the demands for oil get higher in the winter. Those who are most affected by these prices are the homeowners, with demands starting to peak from Oct. through March. Since the chances that you rely on heating oil to warm your home during those months, it is very important that you understand the basics of what affects the price.
Westchester heating oil prices are made from the cost of crude oil, production, marketing, and manufacturing, profits of refiners, wholesales, and dealers. With all of these factors being considered, its no wonder the price goes up every year. The largest portion of these costs of course would be the marketing and distribution areas, with the second biggest costs being the crude oil. Below, you will find a list of reasons as to why the prices would fluctuate from year to year.
Demand of the season – heating oil is only needed when your home needs to be kept warm; therefore it is a seasonal expense and need for you as homeowner. The prices, you will notice start to rise around the peak season, starting late fall, early winter, as the average home can consume about 650 to 1000 gallons of heating oil during colder winter seasons.
Change in the price of crude oil – Since a larger part of the price of heating oil will depend upon the price of crude oil, a spike in those prices will obviously affect heating oil prices. Crude oil prices can change without much notice and therefore sometimes the price for heating oil can also fluctuate.
Local market competition – Local markets have a very small amount of competitors, and therefore the consumers that live in more remote locations will likely have to pay more for their oil. Therefore, if you live closer to competitors in local areas you are likely to save more money by paying much less.
Regional costs – for those of you who don’t know regional costs are basically operating costs. This would mean covering the cost of transporting the oil from its location to your home. This also involves the costs it will take to conduct business dealings. All of these costs mean things such as salaries, equipment, employee benefits, overhead costs, leases, government fees such as state and local taxes, and even insurance polices.
Knowing all of this is important if you’re looking to determine what the Westchester heating oil prices might be once you purchase a home. While most of this information you cannot determine on your own, you can always talk with your heating oil provider about the projected cost per gallon for oil this year. For ways to save you can always talk with your heating oil provider to find out what you can do to keep your bill at an affordable price each month.