Massachusetts - While many consumers who were not locked in to last summer's high heating oil prices have been enjoying a steady drop in the cost of home heating fuel oil, a combination of factors have resulted in prices rising for the first half of January 2009.
Record cold temperatures and heavy snows have both caused the price per gallon of oil to rise $0.09 per week for the first two weeks of January '09. The current average price of $2.44 is significantly less than the record high $4.00 (plus) per gallon prices of August and September (2009). Still, many consumers are watching the price, and shopping more aggressively for heating oil delivery services.
The 2008-2009 heating season is one of the most volatile markets for both consumers and heating oil dealers alike. While some consumers decided to hedge their bets and lock in at a fixed price in the summer or fall, others decided to wait it out and either chosen a daily market rate type of plan, or opted out of a contract all together and buying heating oil as needed from the lowest price suppliers.
The cost of heating oil traditionally rises in January and February in the New England region, but most years by only a few percent when averaged over the course of a year. In 2008, prices rose over 20%, then dropped by more than 30% putting the heating oil at roughly the same price it was in 2006. Citing historic seasonal "weather dependent" price changes as a model, costs may rise for the next 4-6 weeks, then begin to level off or decline by the end of February 2009.