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Why Do Oil Prices Fluctuate So Much?

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transportAs you probably know the price of home heating oil can vary, even from one day to the next, but is generally lower during the summer. In recent months the price of heating oil has plummeted to lows not experienced in decades. What are the reasons for this, and will prices increase again?

The Pandemic

Coronavirus has affected just about every area of our lives, and changed the way we do things quite a bit. Even though the threat is somewhat diminished thanks to vaccines, we will be feeling the impact for some time to come. One effect of the virus has been disruption of transport, as restrictions came into force. This has been a major challenge for companies involved in logistics, who have struggled to abide by the rules while trying to continue their work. Of course import export suffered, and the need for petrol, oil etc reduced.

Summer Demand

As mentioned earlier, during the warmer months homes need less heating oil, so prices usually drop, which is also a factor in the present situation.

Price War

Historically, when oil prices have fallen significantly, OPEC and Russia agree to reduce their production and lower supply. This has been an effective way of balancing demand and supply, keeping prices raised a little. This time however, there were problems on agreeing terms, allowing prices to fall faster. An eventual agreement has not done enough to counteract the reduction in demand.

Whatever the reasons it’s a fact that now is a good time to fill up your tank if you want to save £’s. You can do this safely from the comfort of your home with our online ordering. With Wise Oil you can be sure of the highest quality home heating oil, additives etc, fast delivery and excellent customer service.

 

Heating Oil & Solid Fuels, Fuel Additives, Retail Fuel Services, High Performance Heating Products

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