Oil and Propane Pre-Buy 2008

By Todd Fratzel on Air Conditioning

picture of dollar signUpdate October 2008: Well oil is now below $80/barrel and the pre-buy was certainly a bad idea in hind sight. How many of you pre-bought? Was there a clause for reduced market prices?

Original Post July 2008:
I received an interesting piece of mail yesterday. It was an advertisement from our local oil and propane supplier. The advertisement was announcing this year’s pre-buy pricing. Are you ready for this folks? I wasn’t too shocked because I use propane and although it’s high it’s nothing compared to No. 2 fuel oil that conventional furnaces burn.

So here are the prices in the fine state of New Hampshire:

Pre-buy Prices require you to pay in full for the amount that you purchased the previous year.

#2 Fuel Oil = $4.74 per gallon! Yes folks….almost $5, I remember a time not that long ago when it was less than $1.

Kerosene = $4.92 per gallon!

Propane (LPG) = $2.89 This doesn’t seem bad to me considering I was paying about $2.60 last year.

So this week also poses an interesting question. Do you sign up for the pre-buy?? The last three days have seen oil drop $14 per barrel and it makes me wonder if things are about to finally cool off. I haven’t made up my mind but it’s surely a difficult decision.

How many of you are pre-buying this year? What are you paying?

Related Article – Oil Vs Propane Fuel Calculator is a great post on comparing which fuel source is a better financial decision.

About the author

Todd Fratzel

I'm full time builder for a large construction company in New Hampshire. I run their design-build division that specializes in custom homes, commercial design-build projects and sub-divisions. I'm also a licensed civil and structural engineer with extensive experience in civil and structural design and home construction. My hope is that I can share my experience in the home construction, home improvement and home renovation profession with other builders and home owners. I'm also the Editor-in-Chief and Founder of Tool Box Buzz. Please feel free to contact me if you have any questions, suggestions or you'd like to inquire about advertising on this site.

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3 Comments

  1. Anonymous says:

    I got into a buying co-op earlier this year, and we locked in at $2.19/gallon. I’m in western Wisc.

  2. Anonymous says:

    I was quoted $3.09 for propane pre-buy in Massachusetts. I think I am going to pass this year — though I would be interested in learning more about a buying co-op.

  3. jamie freitas says:

    we use Oil- and didn’t prebuy (couldn’t imagine it staying that high all season to end up ontop of the game this year!). WHEW- thankful we didn’t. We are in a co-op fuel club which is a pay-as-you-go discount program ($35 to join- no other costs). Filled the tank at $3.30 a gallon (price quoted by fuel company directly that same day was $3.99). I’ll keep track of season’s costs to see where I’d have come out w/ prebuy, fuel club, and list price.

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