How low do you think the...

SlamDunk

...Price of heating oil in NYC will go? Was told price is currently $2.45/gallon.

ChrisJ

I'm not a pro, nor do I play the stock market but if you use oil I'd buy it now.

From what I saw for the short time I had oil they seem to jack the prices up in the fall. Whether or not this is planned or intentional I have no idea.

SlamDunk

But the commodity price dropped 5 cents since Friday.

http://www.nasdaq.com/markets/heating-oil.aspx?timeframe=18m

ChrisJ

SlamDunk said:

But the commodity price dropped 5 cents since Friday.

http://www.nasdaq.com/markets/heating-oil.aspx?timeframe=18m

Honestly if either of us were actually good at this we wouldn't be on HeatingHelp.com

I'm sticking with my first prediction. I'd buy before the fall.

ChrisJ

Also,
Isn't this kinda against the forum rules?

We aren't talking exact dollars, but it is discussing pricing.

SlamDunk

I didn't say I would wait until the fall to lock in! I was just curious if anyone felt if it would go lower. I do. It is as much a political question as it is an economic one. I have read that in Scranton PA, residential heating oil is going for $1.71/gallon delivered.

I don't think it is against the rules to discuss publicized prices of commodities. Just cant discuss competitive pricing of parts and work.

RobG

It's not the pricing of fuel that is prohibited. What the rule is for is prevent people from asking things such as "What should a new boiler cost? What do the heating guys charge for labor? Am I getting ripped off? The quote I got seems awfully expensive, what did you pay?" I don't think that fuel prices qualify in the pricing rule. JMHO

ChrisJ

The only reason I'm concerned about the pricing rule is I believe there are quite a few guys here that work for places that deliver oil. I'm not sure how such conversations may effect their business.

If I was you I'd lock in now. NYC will never be near as cheap as PA / NJ.

What I do find interesting as we'll be able to look back at this in a few months and see who got it right.

Robert O'Brien

If you are that confident in your ability to prognosticate, buy a futures contract. 42,000 gallons per contract, you only have to put up $6K margin. Every penny rise will make you $420, goes up a buck and you are 42 large to the good.......

ChrisJ

Robert O'Brien said:

If you are that confident in your ability to prognosticate, buy a futures contract. 42,000 gallons per contract, you only have to put up $6K margin. Every penny rise will make you $420, goes up a buck and you are 42 large to the good.......

Robert get's an awesome for using the term "large".

SlamDunk

Robert O'Brien said:

If you are that confident in your ability to prognosticate, buy a futures contract. 42,000 gallons per contract, you only have to put up $6K margin. Every penny rise will make you $420, goes up a buck and you are 42 large to the good.......

sounds great but i cant get that delivered! besides, there is an abundance of oil in storage.

i say it will go down .30 more. then ill look into buying two or three contracts. never done it before. lets talk about how to do that. someone in the mideast will sneeze and prices will go back up.

i paid $4&change two heatings seasons ago. so, my confidence in procrastinating is high. i dont think it will go up $2

Fred

I personally think it will get down to around $2.10 or $2.15 here in Ohio. We're seeing regular gas at $1.99/gal in a few places and diesel at about $2.32/gal. Predictions are it will go down a little more but if you apply the variance for cost of living between Ohio and NYC your current price is probably close to the bottom.

KC_Jones

I can't comment on NYC. I live in south central PA and a close friend just bought a house with oil heat. They are being quoted 1.99 a gallon delivered right now.

Aaron_in_Maine

Up here I saw 1.70 the other day. Put in a second tank that I took out of a gas conversion. Two full tanks will last me till April

burnerman_2

I have delivered Fuel oil as low as .68 cents to over 4 dollars a gallon and in 1991 I saw it go up in august from .72 to over a buck 50 in a short time... in the fuel oil business you buy in early Sept... then Don't worry about it.... cause really after you buy other then complain what can you do.... but in my experience out of 24 winters early sept. was the best price

SlamDunk

burnerman said:

I have delivered Fuel oil as low as .68 cents to over 4 dollars a gallon and in 1991 I saw it go up in august from .72 to over a buck 50 in a short time... in the fuel oil business you buy in early Sept... then Don't worry about it.... cause really after you buy other then complain what can you do.... but in my experience out of 24 winters early sept. was the best price

I believe the chart I looked at says the same thing about price going up after September.

And, NY being NY, I don't know how much lower it can go with taxes, delivery costs, profits etc.

But, Europe and China has a reduced need for oil, It has been a quiet hurricane season, The US wants to export oil and flood the market even more, Saudi Arabia wont throttle back because they want to break US oil production financially, Iran wants to come back online with its oil and in fact, has tankers filled and ready to sail as soon as we make nice with them...

I cant help but think we will see a repeat of the mid eighties where gasoline prices (in FL) were $1.20 one day $0.50 and less the next.

STEVEusaPA

As an owner, I would never buy future contracts. And I never lock in customers.
The only people who will consistently make money are the traders.
Heating oil dropped (rack prices don't always follow the commodities market) almost 40 cents the first 3 weeks in August, and went back up about 38 cents the next 3 days. In my area, people who locked in at the 'going rate' paid more for heating their house 7 out of the last 10 years then those who bought from me at my daily market price (and I'm far from the cheapest). Many of the lock-in prices offered at the end of last season are much higher then the going rate, with the big oil companies using all their bag of tricks to convince homeowners to lock in. Lock-in locks you into the company, not necessarily the other way around.
Also double check the fine print about things like supply availability (a refinery can shut down for any reason triggering this) force majeure (another moving target). Both of these can 'un-lock' your lock-in rate. Then there's always the crooks, who lock you in, don't cover their commitment with wet barrels, paper, or upside protection, and either go belly up, or don't honor their commitment.
Any war, good (laugh) economic news, hurricane into the gulf, bad winter, lower inventory reports then expected (that game is played every Wednesday), etc. can cause prices to instantly jump up 10 to 15 cents, where if they come down, wont be for a while.
A slow start to winter one year dropped prices through December.
To add onto what was stated earlier, if I knew what the price was going to do, I would be typing this from my iPad, on my private jet, heading to my private island.
SlamDunk, don't worry about your charts...better yet, find a chart from 18 months ago and see what they predicted the price would be this month...way wrong..
Remember the info from your charts, and the reports you read-everyone has the same info. So why are half the people always buying, and half the people always selling.
Also consider, if the stock market lags, people will start dumping their money into the energy sector as they do their tax planning, starting in the 4th quarter, and prices will rise.

RobG

I guess this settles the issue of talking about fuel pricing.

ChrisJ

RobG said:

I guess this settles the issue of talking about fuel pricing.

In who's favor?

SlamDunk

Interesting and informative!

I have heard what you described called rockets and feathers. Price goes up like a rocket and falls like a feather.

I understand what you mean about locking in and losing money if the price goes down. It has happened this past heating season to family members but their oil company allowed them a do over for the new, lower price which I thought was cool. Locking in does provide some measure of insurance. All insurance will cost.

On the other hand, these are really low prices when compared to the last few heating seasons, and in light of the fact that any bad news from anywhere in the world can rocket the price up, locking in on these low prices makes a lot of sense since they really don't have much lower to go. I cant see it going less than a dollar delivered. I think it would be foolish to wait and see if it does.

There will always be an element of risk involved.

I guess when you decide, if you decide, to lock in, is a matter of how much risk you can stomach. My stomach is telling me next week.

ChrisJ

SlamDunk said:

Interesting and informative!

I have heard what you described called rockets and feathers. Price goes up like a rocket and falls like a feather.

I understand what you mean about locking in and losing money if the price goes down. It has happened this past heating season to family members but their oil company allowed them a do over for the new, lower price which I thought was cool. Locking in does provide some measure of insurance. All insurance will cost.

On the other hand, these are really low prices when compared to the last few heating seasons, and in light of the fact that any bad news from anywhere in the world can rocket the price up, locking in on these low prices makes a lot of sense since they really don't have much lower to go. I cant see it going less than a dollar delivered. I think it would be foolish to wait and see if it does.

There will always be an element of risk involved.

I guess when you decide, if you decide, to lock in, is a matter of how much risk you can stomach. My stomach is telling me next week.

All my stomach does is makes me fat when I listen to it.
Ignore your stomach, lock in tomorrow.

SWEI

Liquid fuels are like that.

NG @ $0.54/therm here including all variable costs. Customer charge is less than $12 per month.

BobC

It depends on where you are. Last winter it was about $1.40 a therm for gas in the Boston area, the customer service charge is $10 a month.

Bob

njtommy

My parents just got oil delivery today at $2.19 per gallon

South Jeresy Gas is $1.30 a therm deliver and $10 a month for fees

DanHolohan

With our oil dealer, we lock in a maximum price for the year. Mir the price goes down, we pay less. It's a perfect deal.

I think the worldwide price will drop further once the Iranian oil comes on the market.

BobC

Oil can be had for $1.79 in beantown right now.

http://www.newenglandoil.com/massachusetts/zone1.asp?x=0

Bob

rick in Alaska

In Alaska where it comes from, our current price is $2.67 if we buy over 200 gallons. We get shafted a lot up here.......
Rick

SlamDunk

rick in Alaska said:

In Alaska where it comes from, our current price is $2.67 if we buy over 200 gallons. We get shafted a lot up here.......
Rick

How can that be?

rick in Alaska

No one knows.... Currently gas is about $3.54, which is great from when it got up to $4.96. We are typically about 30 cents higher than in Anchorage, which is 240 miles away by road. Expensive delivery charges I guess. Propane in bulk is $4.30.
We also pay much more for freight, if they will send it here at all. Have had suppliers say they don't send to foreign countries, or out of the continental U.S. . I kid you not. Very frustrating at times. Flat rate is the same no matter where you send it.
Anyway, I will still stay here. Couldn't imagine living on the East coast with the weather there!
Rick

DanHolohan

East Coast weather. That's funny!

ChrisJ

East coast weather isn't a big deal.
I keep asking the wife if we can move to International Falls MN because it's not cold enough here and she won't go for it.

Happiness is a tuned steam system when it's -40F outside and windy.

billtwocase

I don't think I could ever leave the Northeast. You must have cap pricing Dan? We haven't offered lock in for years now, Too risky for a company and a customer. Been there

BobC

The only problem with the northeast was having to shovel 110" of snow off a 100 ft of walkway BY HAND. My back was not happy till June.

Bob

ChrisJ

BobC said:

The only problem with the northeast was having to shovel 110" of snow off a 100 ft of walkway BY HAND. My back was not happy till June.

Bob

Why by hand?

njtommy

Im sure Bobc was thinking about a snow melt system the entire time he was shoveling all that snow.

BobC

My house is on a small city lot (40ft wide) and with a heavy snow there really isn't any place to blow the snow. I gave up on the drive way after the second storm because i had a six ft berm of plow bank that I had no place to put. As it was I had 8-9 ft of packed snow on the front lawn and 4 ft on the roof.

It's a good thing I'm retired and have time to deal with things like that, I even helped my neighbor with her walk (85 and still shoveling snow).

Bob

ChrisJ

BobC said:

My house is on a small city lot (40ft wide) and with a heavy snow there really isn't any place to blow the snow. I gave up on the drive way after the second storm because i had a six ft berm of plow bank that I had no place to put. As it was I had 8-9 ft of packed snow on the front lawn and 4 ft on the roof.

It's a good thing I'm retired and have time to deal with things like that, I even helped my neighbor with her walk (85 and still shoveling snow).

Bob

I have almost no front yard and live on a very wide road in town so I end up with a similar problem which is the entire reason I had to get a snow blower. I couldn't handle constantly having to pile snow over my head.

The blower also lets me throw the snow in between the houses away from the road to prepare for the next batch.

Brewbeer

Is crude oil refined in Alaska or does it need to be shipped out of state to be refined then shipped back ?

rick in Alaska

As far as I know, there is only one refinery left, and supposedly. it only does jet fuel . Depending on who you talk to though. So yeah, refined and then shipped back is current theory.
And also, I have a 350 foot driveway for which I finally bought an old Ford with a snowplow on it two years ago. So, last two years we have had virtually no snow. Five inches last year! And every time I saw the news last winter, the East coast was getting dumped on. I mostly laughed because my next door neighbor moved back to Pennsylvania to get away from the bad winter we had. Then it stopped snowing... Not sure if it was because they left, or because I bought a plow. Also, our typical low winter time temperature here is about 10-15 degrees out. I have only seen it get down to minus 6 in the 23 years I have lived here. Homer is considered the banana belt of Alaska. So yeah, I would not live on the East coast. Sorry Dan!
Rick

CLamb

You can see what folks who have studied the markets and invested money in them think the oil prices will be each month by searching for "fuel oil futures" on the Web. However, from what I've read this price drop is due to the Saudis dumping oil in an attempt to force the shutdown of some of the Baken wells after which they will raise prices again. If you are on good terms with King Salman you might give him a call and ask him when he intends to act otherwise your guess is as good as anyone's.