If you heat your home with heating oil, you have likely been paying more to heat your house these past two winters than you ever thought was possible. While prices seem like they have dropped and leveled off for now, the threat still looms heavily that you may hardly be able to afford to heat your home one of these winters (I’m not joking – we recently received an email from a distressed lady whose 1200 square foot house heating bills exploded last year to the tune of $6,000!).
Heating oil is perhaps the most unpredictably expensive way to heat your home using oil-based energy. This is because the price for fuel oil closely mimics the price of crude oil. The product is richer, more pure and is closer to the unrefined product than any other type of oil-based energy. This means that the cost ofcan fluctuate dramatically if there are any changes in the cost of oil per barrel.
Right now there are two real threats to the price of crude oil: one is political and one is natural. Both of these affect how much we pay for oil-based products. In basic economics we all learned that price is set according to supply and demand. This means that if you have a large supply of a product and little demand for it, the cost of the product would be very inexpensive. Well the opposite is true of oil. There is a high demand for oil, heating oil and other oil-based products but the supply is very limited and threatened.
Politically oil is threatened because most of the world’s oil supply is situated in concentrated parts of the globe. This means that most countries rely heavily on imports for their oil-based energy needs. If for some reason these shipments were cut off, the consequences would be quite grim. Oil is also threatened naturally in that it is a non-renewable resource. Once our oil supply becomes depleted, the cost for oil-based products will skyrocket and we will be forced to look for other ways to create energy. Both of these scenarios threaten the supply of oil and contribute to the rising prices of oil products.
As heating oil and the oil supply become more threatened, the cost to heat your home using oil-based products will continue to rise. And if the supply of oil were cut off suddenly due to a political fallout, you may find yourself unable to purchase fuel to heat your home with.
This is why it is extremely important that homeowners start to look into alternative ways to heat their homes now, before a heating crisis occurs. As you can imagine, alternative heating systems will be extremely expensive and hard to come by during a heating oil emergency. Installing yournow will not only save you money on your current heating bills, but it will help you to avoid the rush for alternative heating sources.