Mainers face higher prices for heating oil

AUGUSTA – Heating oil prices in Maine have climbed to a statewide average of $1.32 a gallon amid strikes by Venezuelan oil workers and the looming threat of war with Iraq.

The average price as December drew to a close represents an increase of 11 cents since the beginning of the month and was 21 cents higher than in the same period last year, the Maine State Planning Office said.

“Uncertainty over the possibility of war with Iraq, the cessation of oil exports out of Venezuela, and colder than normal weather this winter are all contributing” to the increases, Planning Office analyst Betsy Elder said in her most recent weekly energy price update.

Crude oil futures hit $32 a barrel in late December, the highest price in two years, and some oil industry analysts are speculating that they could hit $35 a barrel over the short term.

“It’s just costing more for refiners to produce because crude oil prices are up … $10 a barrel higher than last year at this point,” said Jamie Py, president of the Maine Oil Dealers Association.

Nationwide, heating oil prices surged to $1.41 a gallon as of late December, an increase of 4.4 cents over the previous week, according to the U.S. Department of Energy. Gasoline, propane and diesel fuel prices were also trending upward.

In Maine, heating oil prices varied slightly by region, with southwestern Maine averaging $1.28 a gallon and prices hovering in the $1.32 to $1.33 per gallon range in most other areas of the state, according to the Planning Office.

Webber Energy Fuels was selling heating oil for $1.35 a gallon in central Maine on Friday, up 4 cents over the previous week, said Webber Energy regional vice president David Martin.

Martin said customers are aware of the news emanating from Venezuela and Iraq and haven’t griped about the higher prices. “They anticipate some of it,” he said.

Martin said he wouldn’t be surprised if oil prices continued their upward trend, at least for the short term.