Nov 7, 2007 11:38 am US/Eastern
Mass. Home Heating Oil Prices Reach New Record
BOSTON (WBZ) ―
For the first time ever, the average price of home heating oil has topped the $3 a gallon mark in Massachusetts. The question is - will it stay there?
A weekly survey conducted by the state Division of Energy Resources finds heating oil is now averaging $3.05 a gallon.
At $2.70 a gallon, the cost of propane is also at a record high this week.
The price of heating oil has jumped 33.5 cents and propane 22 cents since the state began its winter fuel price surveys October 9.
The costs are being driven by record crude oil prices that are heading towards $100 per barrel, amid expectations of declining U.S. supplies. The weak dollar and OPEC's apparent reluctance to pump more crude into the market also boosted prices.
Traders wonder if supplies will be adequate to meet demand for heating fuel this winter.
But a local oil company owner told the Boston Globe this price spike won't last.
"There's no fundamental reason why heating oil prices are going up like this," Jim Horan, the owner of Horan Oil in Stoughton told the Globe. "What's happening is institutional investors are buying oil as an inflation hedge and pushing the price up."
Horan told the paper he believes prices will come down at some point.
"Don't panic," he said. "It's probably going to be only one delivery at this price level."
Experts say people can cut down on their heating bill by taking a few simple steps like making their homes more energy efficient and turning down the heat in rooms not in use.
Resources To Help You Save Energy In Your HomeMassachusetts is third largest home heating oil market in nation, according to the Northeast Biofuels Collaborative.
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