Any comments on oil delivery options?

19 years ago

Hi All, when pricing out our yealy oil contract we were given 3 options:

1)Capped price program $2.70 per gal. puts a ceiling on fuel price insuring no upward movement. and providesd for downward flexibility should the price drop.

2) Fixed price program $2.60 p/g no flexilbility up or down

3) Posted price program, based on day of delivery wholesale prices. Has no price ceiling, but can go downward based on the market.

We have a small house, hot water heat( oil) roughly 750 gallons used per year. Any comments or ideas. Anyone who can predict the future is also welcome to chime in. /Abi

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Comments (4)

steve_o
19 years ago
Well, #3 seems to be DOA. What's in it for you? They offer a capped program that can go down in price -- if that happens.

Between #1 and #2, you're talking a $75 difference. Only you can answer whether $75 is a big deal in your budget. If it is, then #2 offers the most protection. If it isn't, then #1 at least offers the possibility of cheaper fuel.

JMHO, but I don't foresee huge dips in the price of fuel oil. There's plenty of competition for it when you consider the demand for diesel fuel and the recovering airline business (all three use similar fuels). Maybe next year, because it's an election year. :-p But not this year.
chrisdoc
19 years ago
Before I switched to gas I had a lot of luck with a small oil company. They were trying to build business by keeping prices low but they required payment at delivery.

I actually mainly switched to a small company because the service contract of the large company was increasing by about $100/yr. I finally cancelled with them when they wanted $400/yr for the service contract.

Many people don't realize that oil heaters require more maintenance than gas heaters.
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honest_me
19 years ago
Now days there is very shortage of oil therfore i should suggest that we should store the oil for future use..becoz without oil we cant make any eatable things :)
cynic
19 years ago
Generally speaking the oil prices will go up in the winter and down in the summer so if you have a "summer fill" program going, you can save some money. This depends though on the size of oil tank you have. How often do you get oil deliveries, size of the tank, any other charges with it such as a delivery or billing charge, etc, all play into a suggestion on what to do. Also factor in what you were paying before? What were the trends over the years, such as when would the prices go up/down, etc? What sort of time frame do you have for getting oil can make a difference. For instance, if you have a month or so to make a decision you can watch for a great price. If you have to have oil today or you'll have no heat (and it's -20Â°) then that will make a difference too.

I'd say that unless there's some other benefit to option #3, I wouldn't consider it. If, for instance they negotiate on market price, or might give a better price than the #1 option, then it could have an advantage.

It all just requires some homework. If you get some more info, let us know. We do want to help, but don't have a lot to work with.

Any comments on oil delivery options?

Comments (4)

steve_o

chrisdoc

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