Some heating oil customers stuck with last summer’s high prices
THE PRICE of crude oil has dropped dramatically from its summer 2008 high of $147 a barrel to about $40 now, but some residential fuel oil customers are not enjoying a similar plunge in their home heating costs.
Fuel oil companies say this is, in part, because many customers opted to sign contracts under which they prepurchased their heating oil a locked-in prices for the current winter season. Those contracts, some of which were signed when oil was near its high. were offered to protect customers against prices that were expected to continue rising. Instead, the bottom fell out of the market, and customers who locked in their prices without also buying “downside protection” find themselves stuck paying high prices.