Heating oil prices are up 70%, just as Northeast residents fill up for winter

People who heat their home with heating oil could spend 21% more this winter to stay warm, according to the Energy Information Administration.

Just 3% of U.S. homes rely on heating oil, and most of them are concentrated in the Northeast. As the weather turns colder, Northeast residents and the companies that deliver heating oil in the region are already trying to navigate much higher costs.

Getting a heating oil delivery is a little like having a gas pump pull up to your house in a 3,000-gallon tanker truck. Todd Lavalley drives one for Gillespie Fuels and Propane in central Vermont. About a third of homes in the state heat with oil.

On a rainy Tuesday morning, Lavalley steered his truck into a customer’s driveway in the town of Berlin, pulled a red hose about the diameter of the fat end of a baseball bat up the driveway, clamped it to a pipe on the side of the house, turned a lever, and oil began flowing.

Unlike at a gas station, there’s no automatic shutoff when the tank is full. Instead, Lavalley has to listen for a high-pitched whistling sound to die down.

“When that stops, that’s how we know it’s full,” he said. “That’s the only way we know it’s full. If you miss, and you don’t shut it off, you have a mess.”

He’s had a few messes in his over 20 years of delivering heating oil, but they don’t happen too often. It’s especially important not to spill any when the stuff costs over $6 per gallon, a record high.

“It is diesel fuel,” said Matt Cota, a lobbyist who represents heating oil delivery companies in Vermont. Like diesel, heating oil prices have been driven up by refinery outages caused by wars across the globe.

High prices are squeezing both residents and the companies that deliver the fuel. For delivery companies, higher prices cut into their profits, in part, because their tanker trucks run on diesel.

“When you see higher prices, you see lower margins, you see higher transportation costs, and you see longer times from when the consumer receives the fuel to when they can pay,” Cota said.

For East Coast residents, a gallon of heating oil costs about 70% more than it did this time last year — though not all residents will pay that price. Some customers arranged for their fuel deliveries back in the summer. That essentially allowed them to make a bet that fuel prices were going to go up, locking in a price of around $4 per gallon.

“In hindsight, that looks like a pretty good deal, but not everyone can take advantage of it, or not everyone thought it was a good deal at the time,” Cota said.

High prices this fall are also prompting more people than usual to reach out to fuel assistance programs. Close to $4 billion from the federal Low Income Home Energy Assistance program is headed to states. In Vermont, that money, coupled with state funds, won’t be released to residents for a few more weeks, said Sue Rossi, the outreach director at Capstone Community Action in central Vermont. But already, people are calling the poverty relief nonprofit about it.

“More people than ever are inquiring about, ‘When is fuel assistance?’” Rossi said. “That happens every year, but not only ‘When is it?’ but ‘How much is it?’ They want to know.”

For now, she doesn’t have answers. But for the neediest clients, she can offer help. Capstone Community Action runs its own fuel assistance program funded by private donations. Because of the high demand, Rossi said the nonprofit started giving out money about a month earlier than last year.

“The people we're actually helping is a… smaller amount of who's calling, but we're doing that on purpose to just get the ones that seem the most needy, most vulnerable, to hold them over.”

The maximum available to a resident, Rossi says, is $500. But with prices so high, the agency is considering increasing that limit as the season goes on.