Unlike Gas Prices, Home Heating Oil Costs Not Expected To Surge From Harvey
HAUPPAUGE, N.Y. (CBSNewYork) – While Hurricane Harvey sends gas prices soaring across the country, some homeowners are breathing a sigh of relief.
As CBS2's Marc Liverman reports, experts say the cost of home heating oil is not expected to rise.
"Don't add to my stress," one Long Island woman said.
"Very happy. I'd rather deal with the oil," a man added.
Liverman met with Kevin Rooney, of the Oil Heat Institute of Long Island in Hauppauge, to find out why home heating oil is not expected to surge. Rooney said it all comes down to an existing huge supply in the Northeast.
But unless customers are locked into a fixed, long-term contract, they aren't out of the woods yet. Unlike Harvey, if another hurricane were to hit the East Coast, it would be a very different story.
"If you get a dislocation in, say, the colonial pipeline, and supplies really become constrained, the only way that can be handled is an increase in prices," Rooney said.
That's why until hurricane season ends in November, Frank Brothers Fuel President Nick Delvecchio is keeping a very close eye on the weather.
"There's always talk, and that talk always makes your customers a little uncomfortable. And it's a problem of: When do you buy? When don't you buy oil, from a wholesaler standpoint?" he said.
Delvecchio said terminals hold 500,000 gallons of home heating oil, which is enough to supply 800 customers for an entire year. That might sound like a lot, but it's actually not if something like Hurricane Harvey were to happen along the East Coast.
"There's less of them, there's less terminals... a lot of terminals have closed," Rooney said.
He said if a hurricane were to happen closer to home, that could lead to a five percent increase in home heating oil per gallon, or what amounts to more than $150 more a year for just one home.
According to Rooney, with current prices where they are, the average household spends just under $2,500 a year on home heating oil.