Crude Oil Prices, Variable-Rate Contracts, and the Safety of Heating Oil

Oil drilling picked up as prices rose. (image: ehow.com)

This article was originally published in the HEAT This Week newsletter, October 23, 2009.

The recent rise in crude oil prices has given oil companies the incentive to start drilling again and spend money looking for new sources of oil. But if companies increase production and start pumping out more crude, that would increase supply and should bring down the price of crude and the price of your heating bill. Ironically, higher crude and heating oil prices now may mean lower prices later. This is good news for heating oil users, as it could mean prices will begin to drop during the coldest months of the year.

OPEC has weighed in on oil prices as well, and the oil cartel has, surprisingly, said oil prices were too high. OPEC’s general-secretary said he didn’t want prices to rise above their current level, and with OPEC’s power, he might be able to make that happen.

Rutland Public Schools thought about the future of heating oil prices and decided the best bet was not to gamble. The school board concluded that a lock-in or cap contract was too risky, and a variable-rate contract was best for the schools and the taxpayers.

Twelve people had to be evacuated from a fire in Marlboro, Massachusetts home. One firefighter was injured battling the blaze. The culprit? A gas valve that had accidentally been turned on during the installation of an appliance, which allowed natural gas to build up in the house. Fire officials didn’t know what ignited the gas, since there were so many possible ignition sources in the house. Even the flip of a light switch could be enough to set the gas on fire.