Heating Oil Pricing Basics: Part 2 of 2

In our last post, we talked about the reasons why heating oil prices are so hard to predict. That kind of volatility can make it difficult to choose the best way to pay for your oil from year to year – which is why we offer you several options for doing it.

Here in Part Two of our Heating oil pricing basics post, we’ll talk about those options in greater detail.

Ways to pay for your heating oil

When it comes paying for your heating oil, it pays to be informed so you can choose a Payment Plan option that’s right for your needs and willingness to take risks.

Pioneer Oil & Propane offers two basic ways* to pay for your heating oil: market price and price cap.

• The market price for heating oil changes daily, with no high or low limit. That means you will be in great shape if the price of oil drops, and not so great shape if the price of oil rises. There is no fee for this plan, and it’s the most risky option of the two options.
• With a Price Cap program, your price has a ceiling, but no floor – which means you’ll be shielded from rising prices while still being able to take advantage of falling prices. However, you will pay a fee for this service; the fee pays for the insurance we need to protect our supply of oil if the market price falls (the fee only covers the cost of the insurance; we don’t profit from it).

Either of these options has its pros and cons – deciding which plan is right for you depends on your tolerance for risk. If you crave certainty, a pre-buy might be best; if you’re willing to take some risk for the reward of a potentially lower price, market price might be a better option. If you don’t mind paying a fee for your pricing plan, a Price Cap will give you the best of both worlds.

If you’re already on a pricing plan, we recommend sticking with it rather jumping from program to program trying to time the market.

Need help in choosing a heating oil pricing plan that’s the right fit for your family? Contact us today – we’re happy to talk about it. Price Cap enrollment is open now – even if your current plan has not expired. Contact us to enroll today!

*Each of these options can also be combined with a pre-buy or monthly payment plan option – learn about the complete range of our heating oil pricing plans and other buying options here).