Making sense of the current prices for heating oil

One of the frustrations of winter, if you are an oil user, is that the prices you pay seem to shift quite a lot through the season - sometimes you feel you have missed out on a better price. It pays to know the current prices for heating oil, and what kinds of things make them shift.

Home heating is the primary demand for this kind of oil. This sounds pretty obvious but it seems to pass some folk by. Most years you would make a saving by buying in your oil out of season (not during the first hard frost of winter) precisely because the demand is greatest in winter and the price will tend to rise.

Local heating oil prices vary due to many external factors - the amount of oil that has been produced is one of these. The oil refiners produce oil from crude as they are producing other products, so they are always trying not to over produce one good and be left with stockpiles. Given heating oil is a winter product and other things - gasoline for cars for example - are year round products, they have difficulty getting the stocks right. Hence the price changes.

A normal user of heating oil will have to refill their storage tanks maybe five times a winter, so it is hard to plan to take advantage of the lower prices. You have to grin and bear it, or switch to another fuel source...