This week, I’m turning the column over to Art Nash, the Extension energy specialist, to talk about the best time to buy winter fuel oil.
Alaskans are known for keeping an eye on gas prices and talking about them just as much as we make small talk about the weather. Twenty-five years ago, gas was available at the Chickaloon General Store for under a buck.
Though folks probably are not cognizant of heating oil changes from week to week, we probably should be. In the last five years, some residents in the Interior have paid well over $5,000 for oil heating during one calendar year.
The big question is, when should you fill your fuel tank for the next winter to get the best price? I’m going to throw out a couple of ideas on timing that purchase.
First, consider safety. Those who have aboveground fuel oil tanks and who live in the outskirts of town might consider filling up when the fire season is over. We have had summers where wildfires have come close to or even burned homes. Having your tank go through a burn — depending how intense it is and the kind of wildfire — may wipe out close to $1,000 worth of fuel. In a worst-case scenario, the fuel ignites from a ground burn and causes greater damage to your home.
Those with underground tanks who think that August will be wet like last year may want to add oil in their tanks now. If the soil becomes water saturated, the weight of the fuel alone will keep your tank from being pushed to the surface as many were last year. An empty tank is so light it might “float” to the surface. This may result in ruptured fuel lines and the challenge of reburying. In addition, you will have to clean up the oil spill.
Another way to look at when to fill the tank is to plan for a proactive market stance. Think about “playing the market.” Crude oil is now about $40 a barrel. With fuel oil about $2 a gallon and bulk fuel around $110 for a 55-gallon drum, do you think there may be a drastic drop in the price coming soon?
One recent financial commentary pointed to a glut of oil supply on the market, full refineries and ineffective OPEC members, leading to the assumption that oil prices will drop substantially.
Others, however, writing in well-known venues such as the New York Times, are assuming the prices for crude oil will recover in the next two years to what they were a couple of years ago, evidenced by a slow increase in demand to take up the glut of supply. We’ll have to see which way it will go. Meanwhile, you’ll need to fill up your tank before winter.
If you have any questions on any of these ideas, feel free to contact me at 474-6366 or email@example.com.