Monday, June 16, 2008

It's Going to Be Cold This Winter!

The price of Diesel and the price of home heating oil (HHO) track very closely to each other. The reason is that home heating oil and Diesel are very similar products, such that to make more of one means making less of the other (from a given barrel of oil).

The price of Diesel has risen significantly faster than the price of gasoline, most likely due to the increase in Diesel cars being built and sold around the world.

In the winters of 2005 - 2006, and 2006 - 2007, Diesel and HHO cost about $2.50 per gallon. Last winter, they cost about $3.50 per gallon. Diesel is currently going for about $4.75 and rising.

This is going to be a big deal this winter. If Diesel hits $5.00 per gallon and stays there over the winter, there are going to be people freezing to death all over the Northeast and Midwest (where HHO is commonly used).

I don't have any answers to this problem. But I will say that if I lived in a home that used HHO, I'd spend my summer insulating. If I ran a local government in an area with lots of HHO heated homes, I'd be scrambling to find funds to do whatever could be done to mitigate this problem NOW.

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