Written on: July 24, 2023
While Westmore Fuel cannot control what happens with oil prices that are tied to the global market, we can give you some understanding about why heating oil prices rise and fall on a steady basis.
We need to start by looking at the price of crude oil, which is usually the most important factor in the price that consumers will pay for their heating oil. Like gasoline and jet fuel, heating oil is just one of the many products refined from crude oil.
Crude oil is a globally traded commodity, which means that it is subject to many forces that drive its value up or down. So, when crude oil prices are on the high end, so too are heating oil prices—along with gasoline, diesel fuel and many other products.
Even the possibility of a big disruption in the vital energy supply chain heavily influences the buying and selling done by commodities traders. Here’s a recent example: a Wall Street burst of trading activity took place in the months before Russia invaded Ukraine in early 2022. This caused energy prices to rise based on speculation in the stock market about what could happen in the near future if sanctions were imposed on Russia. This is often referred to as the fear factor.
After Russia eventually invaded, the U.S. and other countries placed bans on Russian imported oil and other energy products. It left a big void to fill. And as you know by now, energy prices soared even higher as a result.
Before the uncertainty created by the Russia-Ukraine war, oil prices had fluctuated because of COVID-19. In spring 2020, crude oil prices actually plummeted to historic lows when economies locked down across the globe. Oil production essentially ground to a halt.
Another supply-demand issue has centered on diminished oil refinery production. Some refineries closed or scaled back because of the collapse in energy demand in the early months of the COVID-19 pandemic. Additionally, a number of refineries were shut down because they were inefficient, and their profits weren’t large enough for Wall Street investors. Other refineries were closed so that their owners, seeing the proverbial writing on the wall, could convert them to produce biofuels*.
We own and operate a 1.2-million-gallon marine storage terminal in Port Chester. This gives us the power to buy in quantities that let us guarantee supply to our customers. This also puts us in a position to provide a range of pricing and payment plans that help protect our customers from big price spikes. This is part of what we call the Westmore Advantage.
For instance, Westmore’s EvenPay plan uses an estimate of your annual heating oil bill (based on your past fuel use) to calculate 11 equal monthly payments. The result: your heating oil payment will always be the same, no matter how much fuel you use in a given month.
Imagine knowing there will be no surprise winter heating bills – or being able to plan your finances knowing what your energy bill will be. There are no fees for this program. In fact, we’ll give you a 1% rebate, calculated annually, in any month that you have a credit balance.
For more convenience, many customers combine our monthly payment plan with our AutoPay option to pay their bills automatically, either through their bank or credit card.
For further peace of mind, we also have the resources to offer pricing contracts, which give customers the security of knowing that their heating oil price will never go higher than the established capped or fixed price.
Contact us today to learn more about reliable heating oil delivery, protected heating oil prices and everything else Westmore Fuel can offer you.
From Darien, Greenwich, Stamford and Port Chester to Mount Kisco, New Rochelle, White Plains and surrounding communities, Westmore Fuel has been taking care of our customers in New York and Connecticut since 1938.
*Source: NY Times, 11-10-22