Heating Oil prices put Pellets on back burner.

Assuming you could start either heat source easily, without a lot of preparation, which would be better: choosing the cheaper fuel at current prices or what you paid for it?

velvetfoot said:

Assuming you could start either heat source easily, without a lot of preparation, which would be better: choosing the cheaper fuel at current prices or what you paid for it?

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If you are already prepared and stocked for Winter then current anything except the weather or broken hardware is irrelevant.

The same question can be posed of someone who has 11 cords of prime hardwood ready to burn in their back yard. Let's say it cost them nothing as they harvested it themselves. Do they heat with that firewood to save money ? If they can sell it to someone for $250-$300 / cord and buy oil to heat their home at under $2/gal ? For a hefty profit, not knowing for certain what it's replacement costs could be in the future ?

Oil is still about $2.62 per gallon where I live. I figured it out and if i bought the minimum 150 gallons of oil at that price it would be $390. That much oil lasts me roughly a month...maybe a month and a half. A ton of pellets will cost me $255 which will last me roughly the same amount of time, that's still a difference of $135 in favor of wood pellets for me. Now if the price of oil drops to $2.07 here like it is where you live...I'll be firing up my oil furnace again . It's hard to tell what will happen in mid-winter...who knows, the price of oil could skyrocket again and if you didn't buy any pellets because you relied on oil staying about $2.07 per gallon or so you'd be screwed. I'm playing it safe and getting at least 2 tons of pellets...if oil continues to plummet all the better but if it starats rising dramatically again I'll be prepared...hopefully .

I do have to wonder if current pricing is going to lead pellet prices down. Home Depot already has pellets stacked out front (typically HD doesn't get them until September) I have to wonder if they came from a warehouse that was full due to lack of pre-buy. I'm certainly not buying at current prices. It will be an interesting winter, no doubt.

Edit to add... Current local price of heating oil is $1.94

Wow to the price of heating oil I wish it were like that up here in Vermont where I live...I'd definitely give some serious thought to purchasing at least 150 gallons.

There are some places in MA with $1.79 heating oil. However, I am certain that if the price holds through the start of heating season we will see a huge drop in pellet prices.

Getting a bit OT... but I've told some friends considering solar: "What if the price of electricity drops substantially"? "That will nevier happen", they say. I then remind them that heating oil is half the price it was last year at this time. Unlike pellets, once you buy those panels your price is locked in forever. If Elon Musk develops a panel that is 2 or 3 times more efficient or develops some new way to generate nuclear power, electricity prices will start to drop like a rock.

jfunk138 said:

There are some places in MA with $1.79 heating oil.
However, I am certain that if the price holds through the start of heating season
we will see a huge drop in pellet prices.

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Huge?
Absolutely not.

Dan

Oil here today in Ct/mass is $1.99 , lowest since easter weekend, pellet's are $269 for FSU at my HD in Enfield ct,I'm all in for oil shoulder burning then ton or 2 of pellets for middle of winter.

relxn88 said:

Oil is $2.07 and dropping. The calculating chart http://www.travisindustries.com/CostOfHeating_WkSht.asp
shows the break even price for Pellets at $2.25. Around here, I figure I'll be paying $299 a ton for pellets. I usually buy around 4 tons, but I've decided to just by 1 ton of middle of winter, hot burning pellets, just to help out. The shoulder seasons are going to be heated by oil. The old bugaboo about oil prices going up in the winter doesn't matter. I'll just buy the pellets when or if the oil price goes above $2.75 (my break even point). If the prices of pellets DID rise this winter, it makes burning oil all that more reasonable.
I've enjoyed heating my home with pellets, but for me, pellet burning has pretty much priced it's way out of my home.

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Thanks for sharing the link to Travis fuel cost calculator. It is one of the better I've seen on the web. One thing of note is they use 115,620 btu/ gal of #2 fuel oil. Most sources put the value at 138,000 to 140,000 btu/gal. That would tend to overstate the $/MMBTU for oil.

My plan is to burn as much wood in the insert since I have about 40 cords stacked. They all came from log loads, which is like $100/cord.
Still have to burn oil or pellets though.

$269 for FSU at HD here too. They had 15 ton today with one skid open to sell single bags out of. They had some all Summer too, just kinda hidden behind the mulch.

I wouldn't count on the price of pellets dropping. At least not very much. Doubt oil's going too much lower either. Doubt it's going up much more than it has in the last 6 months either.
I'm not seeing much firewood for sale yet like usual either. What I am seeing new is a few guys trying to sell truckloads/or 1/3 cord of pine for $70-$90. No cheap buy it now green hardwood ads. Not looking good.

EatenByLimestone said:

It sounds like you have quite a backup plan! 40 cords must take the square footage up of my house! Any pics of those massive stacks?

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Here are the pics. I come up with 43.66 cords.

I doubt pellets will go down much in price maybe HD and the other BBS may put them on sale for 10% off like they typically do. You may see a couple big mills shut down or stop producing pellets for domestic use though.

EatenByLimestone said:

Wow. That's a lot of wood! And to think you were looking to get rid of that splitter a couple years ago!

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I don't remember that. I know I had a tank leak that needed rewelding and the cylinder's big retaining nut was loose and needed to be retightened. However, the small electric splitter is for sale.

Oil here $189.9, pellets high.

Hearing reports of $1.75-1.79 a gallon here in the New Haven, CT area. New Haven is one of the biggest entry ports for heating oil for New England. I live about 4 miles away from the terminal so local dealers sell heating oil around here cheap. My supplier is literally across from the terminal.

Not a pellet burner but I am going to substantially cut back on the wood stove this winter as I am going to fill my 275 gallon tank within the next week or so.

Local Home Depots have pellets for $269 a ton. Sorry $1.75 heating oil is way cheaper than that $5+ bag of pellets right now....

Wow. I'm near Albany. Paying way too much retail.

For the difference I'll burn pellets, I like the heat and glow of the fire. If 1 refinery goes down or a bad hurricane season, or if something in the middle east bam high oil price. Now if we are talking a lock in oil price under $1.95 I'll have to think on it LOL.

JoeP said:

For the difference I'll burn pellets, I like the heat and glow of the fire. If 1 refinery goes down or a bad hurricane season, or if something in the middle east bam high oil price. Now if we are talking a lock in oil price under $1.95 I'll have to think on it LOL.

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Same here. I am still going to burn. But wow is oil cheap right now..

Is $1.50 a gallon a possibility?

Fuel Oil price today is $1.95 a gallon. Quality wood pellets are over $280 and closer to $300 with delivery. I can get 200 gallon oil fill up for under $400.

At those prices I got to be stupid to burn wood pellets this year.