This heating season, not quite done, has been one for the record books. Huge amounts of snow, very cold weather, but also a big drop in oil prices compared to last year categorized the winter. And it’s been the best year for Mass Energy/People’s Power & Light Discount Heating Oil Service members in a long time. Compared to surveys conducted by the state energy offices in Massachusetts and Rhode Island, throughout this winter our members have paid 44 cents less than full-service dealer prices in Massachusetts and 35 cents less than full-service dealer prices in Rhode Island, after adjusting for heating degree days. 

Read more about member savings.

But this February--the second-coldest on record--was not kind, in terms of both snow and oil prices. The trend for oil prices has been to climb, with some days being a dime higher than the day before. But oddly enough, some days trended in the other direction, at a dime less. Yikes! What’s causing such dramatic shifts?

We will mention three particular factors causing volatility.

1. The main factor has been our fine New England weather. There have been a number of local shortages caused by iced up harbors and shipping delays.  This affects the wholesale market that dealers generally rely on. 
2. February’s frigid temperatures have also pushed electricity generators into the heating oil market to fuel the extra amount of electricity needed to keep the lights on. The generators use oil when natural gas is in short supply, as is the case now. This creates a spot price squeeze and that translates to the wholesale price paid by the dealer serving your home.
3. On top of all that, perhaps some speculators have added to the excitement by bidding up heating oil contracts way beyond the increase in gasoline prices that most of us have seen when we fill up our cars. But we have also seen a day or two when the price went DOWN 10-20 cents a gallon. We are hoping for a few days like that to return if/when we begin to see more seasonal weather. Speculators will flee the market and hopefully prices will get back to reflecting the law of supply and demand. That could mean prices easing back to $2.70 or so. And there is other good news: US inventories of crude oil and heating oil are very high in comparison to recent years.

As a final thought, please remember that February’s price increases were not the oil dealer’s fault. They are doing super-human work to deliver in a timely fashion and keep you from running out of oil. After all, due to the storms, they missed time and have had to deal with the same narrow streets and traffic jams as we do, as this article from the Providence Journal explains. PLUS they have to deal with 10 foot plus snow banks and unshoveled paths to your fill spout. That’s why we have been asking our members to help their dealers by clearing a path to the spout. Ultimately it will save them time and you money.

If you're a member...

If you were taking deliveries from one of our dealers in Massachusetts or Rhode Island through the fall and winter, you saw prices drop with each one. Our price started off at about $3.32 on September 1st and kept falling, all the way to $2.22 on January 30. Our members have paid over a dollar a gallon less than last year!

Compared to surveys conducted by the state energy offices in Massachusetts and Rhode Island, throughout this winter our members have paid 44 cents less than full-service dealers in Massachusetts and 35 cents less than full-service dealers in Rhode Island, after adjusting for heating degree days. Without question, this has been one of the best years ever to be a member of Mass Energy or People’s Power & Light.  In our marketing, we claim that our members will save $100-300 per season to be on the safe side. This winter, a cold one, a member using 750 gallons of oil has saved about $300 dollars--and winter isn't over yet!

If you’re not a member, consider joining today! In March, you can get almost 2 years of membership for the price of one as part of our MARCH MADNESS promo:

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