Further worries today about a military strike on Syria have pushed up Crude oil prices to 6 month highs. This will and has increased the price of Home Heating Oil long before any expected rise due to cold weather. In addition to higher Crude Oil prices, today has seen an increase in both BP and Shell shares when the rest of the Stock Market has fallen. This is a sure sign speculators expect this situation to continue for some time and oil prices to rise.
I am an optimist and although I expect to see prices of Home Heating Oil continue to rise in the short term it may be too soon in the seasonal cycle and so the price may peak too soon and lack of supply demand could force prices down before the cold weather kicks in and demand for Home Heating Oil rises. This will of course only happen if air attacks do not go ahead on Syria. Should a continuous air bombardment take place then the military will use up all surplus supplies of Jet Kerosene. As mentioned in the Top Up Fuels blog before, Jet Kerosene is the same product as Kerosene that is used in Home Heating Oil and so an increase in demand for Jet Kerosene will see home Heating Oil, also known as Domestic Heating oil increase in price.
Apart from the effect on Home Heating Oil prices, lets hope from a humanitarian point of view we do not see an escalation in the Syrian conflict for everyone’s sake.