Low prices won’t affect oil company profits

It’s been a long, cold, lonely winter, but those throughout Connecticut can be thankful for at least one thing: low home heating oil costs.
The cost of home heating oil throughout the United States dropped 17% from October to January this year, even though customers have dealt with extreme weather conditions for most of the new year.
Gault Energy President Sam Gault told The Bulletin last week that his records show January was 4% colder than last year, and February has been 15% colder. The normal high for this time of year is in the low 40s.
“The colder it is, the more deliveries we’re making and sometimes the more service calls we make,” Mr. Gault said. “Heating systems are working harder and longer hours, which often makes for a bit more repair work.”
The lower oil prices do not adversely affect the oil company’s bottom line.
“The lion’s share of the time, low prices are better. It’s always nice to heat your home at a lower price than last year. That’s been a nice thing for most of our customer base,” he said.
“The myth is that higher prices mean more profits, but that’s really only for the Exxon-Mobils of the world. We work on a consistent cents-per-gallon margin. It doesn’t matter where the price is, we’re still working on the same margin.”
Tough deliveries
While the cold, snowy weather has energy companies out making more deliveries than normal, the length of an average delivery is extended by poor conditions.
And, Gault Energy Marketing Director Meredith Bonaher said, “because of the snow, the deliveries are a lot harder.
“The guys are taking longer to make deliveries, and almost every driver has a helper driving along with them. They are there just to pull the hose to the oil tanks, because it’s a really exhausting day if they have to do both” and shovel a path to the tank, she said.
In worst-case scenarios, some driveways are impassable for the oil trucks, and deliveries must be delayed.
“Sometimes we’re not able to make the delivery if it hasn’t been plowed, or it’s too icy,” Ms. Bonaher said. “In that case, the delivery has to come back to the office and call the customer. There are a lot more logistics going on because of the snow and the weather.”
To make deliveries easier for their oil company, Gault recommends that all customers shovel a path to their fill pipe, and make sure their driveway is cleared at least 10 feet wide. On steep driveways, substantial salting is also a good idea.

How to spend even less

Even though prices are low, many residents are still interested in spending even less to heat their homes every winter.
One of the best methods to prevent heat loss, Mr. Gault said, is for residents to perform spot checks of their windows, where most of a house’s heat loss takes place.
“We try to make sure that people are walking around the entire house and making sure they cover up the colder spots around windows with curtains. A lot of heat loss goes out those windows,” he said. “Be aware on these severe temperature days to check that out.”
The oil company president also suggested that any resident who leaves a home vacant for an extended period of time have someone check the home’s heating system on a daily basis.
“A lot of people vacation in Florida from Fairfield County for extended periods of time. It’s really important that someone is walking into the house every day to make sure the heat is on. That’s where the problem lies, when someone doesn’t check and three days later the heat went off,” he said.
One of the biggest threats to unattended heat systems, he added, is a downdraft caused by high-wind situations.
“A very windy day can cause a downdraft and make the unit’s [pilot light] go out. Then you have a situation when you walk in three days later and it’s less than 32 degrees and now you know you’ve got frozen pipes. When it’s colder, the more times you have to check.”