As heating season winds down, no relief in (heating) oil prices

[jpak]

http://pressherald.mainetoday.com/story.php?id=180182&ac=PHnws

Along with robins and crocuses, a welcome sign of spring across northern New England is watching the heating season wind down. It usually signals a drop in the price of heating oil, but that hasn't been the case this year.

After months of soaring fuel bills, prices remain at least as high as they've been at any time this winter, offering little relief to hard-pressed households.

In Maine, the average cash price for No. 2 oil hit a season high of $3.78 a gallon three weeks ago when the state Office of Energy Independence and Security compiled its final price survey of the season. That was $1.39 higher than at the same time last year.

New Hampshire's average price during the third week of March was $3.85, a jump of more than $1 since the heating season began last fall. Vermont has seen similar price increases.

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[acmavm]

1. The fear that there is only so much time to rape the public will

keep them cranking out those high fuel bills until the bush** admin is ushered out of office in January 2009. Hopefully (more than hopefully) we won't get a McCain administration. But with the two losers we're fielding, we probably will.

[GliderGuider]

5. What will you say when fuel prices keep rising under a Democratic president?

And they will. These price rises have precious little to do with corporate malfeasance or any desire to rape the little guy. There's this thing called "Peak Oil" -- you might have heard about it?

[jpak]

7. If that Democratic president forces commodity traders to take actual delivery of heating oil

it would inhibit speculation in heating oil markets...

on edit: and if that Democratic president had an economic policy that favored a stronger dollar, that would help too..

[GliderGuider]

10. There's been no increase in the "speculation premium" over the last year.

According to the OP, heating oil is $3.78/gal today, and was $2.39 a year ago.

Today crude oil is selling for $105 a barrel, while a barrel (42 gallons) of heating oil would cost $158.76 - a premium of 51% that covers refining, distribution and middleman profits.

A year ago crude oil was selling for $65 a barrel, while a barrel of heating oil would have cost $100.38. That's a premium of 54% - almost identical to the current situation.

I don't see any evidence in these numbers for a rise in speculation in the domestic heating oil markets, at least not over the last year.

[acmavm]

9. Peak oil doesn't have a damn thing to do with our problems right

now. Have YOU not heard of the new discoveries in the Gulf and in Russia and in other areas? We've got fossil fuels to hold us until we develop an alternative source, one that doesn't starve half the planet by using all the grain supplies. But we won't do that until every damn last drop of fossil fuel has been pumped out of the ground and we've let bio-fuels prove that they aren't the way to go.

And just as a warning, don't be a smart ass. Don't ask me if I've 'heard' of anything, or even hint that I'm less intelligent than you are.

Right now we are not suffering from a shortage of ANYTHING. There is plenty of oil to go around, we haven't tapped out yet. OPEC and the oil boys are just having a feeding frenzy while they can.

But there might come a day when price gouging the public during a time of 'war' may become a no-no and those that have gotten away with it up until now may find themselves in a little bit of hot water.

[GliderGuider]

11. New confirmed discoveries amount to very little.

They are measured in scant weeks to months of world supply, and most won't even come on stream for several years yet. Hell, they don't even have Thunder Horse up yet.

World oil production has been flat for the last three years, while demand has kept rising. In that situation, basic economics says prices will rise.

Some very astute oil analysts say that the production plateau will not turn up, but rather will roll off into a decline within the next two to three years (personally I think it will happen in early 2009). That is not long enough for us to get alternatives in place in sufficient quantities to plug the growing energy shortfall.

The point is, as of recently there isn't enough oil to go around, and it's being allocated by price. World oil prices have tripled in the last four years. Prices don't do that in a global market if there is a balance between supply and demand. What's happening isn't gouging, it's Economics 101.

[acmavm]

12. Alternatives can be in place. The oil industry and the oil families

are the only ones that are promoting that line.

We aren't doing a damn thing to cut the need for fossil fuels because too many economies are dependent on oil revenues. As are the oil families.

[GliderGuider]

13. Most of the "oil families" are now NOCs

I.e. National Oil Companies in like those in China, Kuwait, Venezuela, Mexico, Iran etc. They have oil, they want to sell it. It's not their job to convince the world not to buy their product.

There aren't many options for wholesale conversions away from oil, certainly none that will be ready to roll out on a global scale within 5 years. I agree that consumers haven't been making many moves away from oil dependence, but that's another cool thing about the market - as soon as the price of a commodity like oil gets too high, people will make changes.

There are three ways those changes will happen -- substitution, efficiency and demand destruction.

For substitution in transportation, electricity is really the only choice. At this point it looks like electrified rail is the only large-scale option that could be rolled our rapidly and economically enough. Electric cars are on the horizon, but will probably not be ready in sufficient numbers to make more than a small difference globally within the next 5 to 10 years.

Europe has already showed the way forward with efficiency, they have many high-mpg cars on the road, and their acceptance has been driven by high fuel prices. Look for that trend to finally penetrate the Land of the Escalade as gas prices go up on our side of the Atlantic.

Demand destruction will soak up the rest. Many people will simply stop driving as much (or driving at all).

We are in the situation we're in. There's little point laying blame at this stage -- while it may be satisfying to have a scapegoat (GOP, oil families etc.) it's far too late for that to be useful. It's now time to elect some more visionary leaders, complete our personal preparations and hope for the best.

[fight4my3sons]

2. Prices for my area are ridiculous

Oil prices for Midcoast Maine High 3.949 Low 3.509 Average 3.747

http://www.maineoil.com/zone5.asp?type=0

Unfortunately we are in need of oil yet again.

[jpak]

3. I got a pellet stove in early March and heat my whole house for $6 a day now

Beats paying for 150 gallons of oil a month...and living at 55 degrees...

[fight4my3sons]

4. yes, that is the way to go

We rent. Can you get a pellet stove when you rent? We have a wood stove and do keep our heat down very low and have plastic on all of our windows. We got help with oil from Citgo and Salvation Army earlier this year and I have an appointment with LIHEAP tomorrow. At least it is beginning to warm up during the day, but the nights are still pretty cold.

[jpak]

6. Ask your landlord - the installation is easy (done in a couple of hours)

and the one I got can go anywhere (even on carpet).

You can get them at Lowe's for ~$800 and pellets are ~$250 a ton (a ton fits on a pallet chest high).

You can also buy individual 40 lb bags for $5-6 a piece (no need to buy a whole ton if can't afford it or can't store it).

You'll save Big $$$ - and best of all...you'll be warm.

:hi:

[fight4my3sons]

8. thanks for the info

definitely something to consider

:hi: