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Heating oil hot commodity

Jeff Oliver
By Jeff Oliver
4 Min Read Dec. 10, 2004 | 21 years Ago
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Anyone who drives an automobile knows first-hand how much the rising price of gas has affected their travel budgets.

Well, folks who heat their home with oil are feeling the same pinch this winter.

That's because, similar to gasoline, the price of heating oil has increased immensely over the past year.

One business owner estimated that the price of a gallon of heating oil is 42 percent higher than it was this time last year.

Andy Suchko, of Suchko Oil Co. in Belle Vernon, said the cost is approximately $1.70 a gallon, if a customer orders a minimum 200 gallons of oil. The price drops somewhat with larger orders.

"I'm not sure, but I'd say this time last year it cost about $1.20 for a gallon," Suchko said of 200 gallon orders.

"I know the price has gone up. It's higher than it was a year ago," he said. "A lot higher."

Suchko said the Mid-Mon Valley area has several pockets of heating oil customers.

"In this area, there are a substantial amount of people who use heating oil because there are no gas lines in some of the coal mine patches," he said of the small communities established by coal barons early last century.

A winter home heating oil bill last winter was about $800. This winter, it could cost about $1,150 to stay warm.

"It all depends on the condition and size of the home," Suchko said.

Lou Majoris, of Majoris Gas and Oil in Donora, says his rate for heating oil recently dipped to $1.59 for a 200-gallon order.

While the price of heating oil is higher than a year ago, Majoris says it has been coming down slowly in recent weeks.

"The cost of oil fluctuates so much during the summer and winter," Majoris said. "The highest it was recently was about $1.98 a gallon." That was right before the election.

"Then the 'good guy' won and the price of oil started coming down," Majoris said of President Bush's re-election campaign.

Neither Suchko nor Majoris could predict the price heating oil will bring during the coldest part of the winter season.

"The oil companies are the ones in charge," said Suchko. "They make the call."

"Lower petroleum and natural gas prices in this outlook marginally reduced our projections of winter heating fuel prices and winter household heating fuel expenditures," the Energy Information Administration indicated in a Dec. 7 report posted on the American Petroleum Institute's Web site.

Heating oil expenditures by typical Northeastern households are now expected to average 34 percent above last winter's levels, with residential fuel prices averaging $1.85 per gallon for the October-to-March period, the institute predicted.

Expenditures for propane-heated households are expected to increase about 22 percent this winter, it noted.

Expected increases in expenditures for natural gas-heated households have also been lowered in this outlook to 9 percent.

The reduction expected in expenditures for all three fuels, relative to last month's estimates, reflects reductions in both prices and projected usage, it concluded.

Majoris said some homeowners might try to conserve heating oil and delay purchases in hopes the price to drop.

"They can do that if they have ample supply," Majoris said. "But it's like when you drive your car. If you have a lot of gas and the price of gas is high, you might wait a couple days before buying it.

"But if you need it, you buy it."

Leona Greene, of Perryopolis, heats her home with oil. She said she has noticed the jump in price.

"I just bought some oil last week," she said. "I paid $1.70 a gallon."

Greene noted that when she bought oil in January, she paid $1.40 a gallon.

The woman says she is trying to conserve as best she can.

"I used an afghan a lot and wore sweaters," she said. "At night, when I go to bed, I turn the thermostat down to 62 so my furnace won't turn on as much."

For families struggling to meet the costs for oil heating - or any type of home heating - assistance is available through the federally funded Low Income Home Energy Assistance Program (LIHEAP).

To be eligible for the program, homeowners and renters must have annual incomes, before taxes, at or less than $12,569 for a one-person household. For each additional person in the home, add $4,293 to determine eligibility guidelines.

Applications are available at county assistance offices.

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Home heating

oil prices

2003 averages

1st quarter: $1.45

2nd quarter: $1.28

3rd quarter: $1:18

4th quarter: $1.29

2004 averages

1st quarter: $1.42

2nd quarter: $1.41

3rd quarter: $1.51

4th quarter: $1.84

Annual averages

2003: $1.32

2004: $1.56

2005: $1.73 (projected)

*Price per gallon

Source: Energy Information Administration

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