I know it's odd to talk about heating oil just before the July 4th weekend, but with the soaring price of oil, it's not to early to look ahead and hedge against even higher prices. We use oil to heat our home, and happen to have a 1,000 gallon tank, which means that we don't have to have deliveries every few weeks during the heating season. We also keep the temps on the cool side and our programmable thermostat lets us turn down the heat during the day when we're not home. Those steps help let us save during the heating season.
However, our annual contract is up at the end of the summer, and our price cap is sure to rise significantly given the current price for oil. The current price for home heating oil is significantly above $4 in Westchester County, NY. For New Jersey, the most recent price (April 2008), shows a price of $3.71.
Our current cap is $2.989 per gallon.
With that in mind, I called up to have my tank topped off. We took just over 300 gallons, running to nearly $1,000. Depending on which figure you apply, we saved anywhere from $250 to $500 on this one transaction. Since we have a monthly payment plan, we're able to spread that price out over the course of a year. I can't imagine what it would cost someone to fill up during the height of the heating season if the price of oil doesn't come down and you aren't protected to the upside by a price cap.
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