What is Heating Oil?

Heating oil is a refined oil made from petroleum, used in furnaces to heat buildings. It is the main source of heat in about 8.1 million American homes. People living in the northeast US are more likely to heat their homes with oil than other parts of the country, consuming more than 80% of the total used every winter. Diesel oil and heating oil are quite similar, and they are refined in a very similar way.

People whose homes rely on oil for heat in the winter are justifiably concerned about its cost. As with every petroleum product, the price goes up and down, depending on the cost of the crude oil from which it is made and other variables such as refinery capacity.

Heating oil is trucked to individual homes and pumped into underground storage tanks. Since it is more expensive in the winter, when demand is high, most people will have their tanks filled in the summer or early fall, when prices are lower. Unfortunately, home tanks are rarely large enough to store enough fuel to last through the winter, so homeowners often must purchase more oil at winter prices.

Weatherproofing a home can help keep heating costs down in the winter. Homeowners can make sure that their windows and doors are close-fitting and install weather stripping around them to keep out drafts. Passive solar systems can also be useful. Homes with north-facing windows can allow the sun in to heat that part of the house during the day, and windows should be covered with insulated curtains as the sun goes down to prevent heat loss.

Some heating oil suppliers will allow their customers to spread the cost of the oil out over the entire year. This lessens the shock of having huge utility bills in the winter months, at the cost of paying a little more during the warmer months. Of course, homeowners can turn down the thermostat when they are out of the house and wear more layers of clothing when they are at home to lower their heating costs more simply.