Average Cost of Heating Oil Jumps to $2.61 a Gallon in Mass.
Posted on: Wednesday, 7 September 2005, 18:00 CDT
Sep. 7--The average price of heating oil in Massachusetts jumped to $2.61 a gallon yesterday, the highest level since the state began tracking prices in the mid-1990s.
The survey of full-service dealers by the Massachusetts Division of Energy indicated retail prices ranged from a low of $2.40 a gallon to a high of $3.02, a 62-cent spread.
The last time the state conducted a pricing survey, on Aug. 2, the average retail price was $2.15 a gallon and the spread between the highest and lowest price was 50 cents a gallon.
State officials don't start conducting weekly surveys of heating oil prices until the heating season officially begins in October.
Larry Chretien, executive director of the Massachusetts Energy Consumers Alliance, a heating oil-buying cooperative in Jamaica Plain, said retail profit margins appear to be creeping up.
Chretien said the average retail margin in Massachusetts -- the difference between the average retail price and the average wholesale price -- was 41 cents a gallon on Aug. 2 and increased to 48 cents yesterday.
"Prices are bouncing all over the place, and where they're going to settle in it's too early to say," Chretien said, noting the wholesale price had actually declined since late last week.
The volatility of heating oil prices, accentuated by the havoc caused by Hurricane Katrina, has caused many local dealers to back off or eliminate price protection programs.
One dealer in Lexington last week informed his customers that the market wasn't stabilizing and he wouldn't be offering a price protection program, which either locks in a price for the entire winter or caps how high the price can go.
In July, the US Department of Energy forecast that the typical heating oil customer in the Northeast would pay $1,486 to heat a home this winter, an increase of 16 percent. That forecast was based on an average price for heating oil this winter of $2.13 a gallon.
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Source: The Boston Globe
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