A Comparison of the History of Oil Prices
Back then: Beginning in 1985 and continuing in 1986, crude oil prices fell by about 67%
Now: Beginning in 2014 and continuing in 2015, crude oil prices dropped about 60%
Over the last 30 years, these have been the only two times that crude oil prices had fallen 50% or more from their peak levels. How does this affect heating oil consumers? Well, after the price plunge in 1985-86, for the most part oil prices remained low and stable for 15 years, except for a temporary blip during the lead-up to the Persian Gulf War in 1991.
Will history repeat itself with oil prices?
It remains to be seen how oil prices will play out in the years ahead due to unpredictable factors, including severe weather, the state of the economy and world events affecting energy production. But with U.S. oil production levels surging strongly, there is a better chance that oil prices may stay at lower levels in the future.
Take a look at all of this good news
- Heating oil prices remain at their lowest level since 2009.
- U.S. oil production has reached its highest point in 43 years; that’s a big reason why many analysts predict that oil prices will stay lower for the foreseeable future.
- The average wholesale heating oil price stood at about $1 less per gallon than at this time a year ago.
- U.S. household expenditures for heating oil this winter are projected to be 25% lower than last winter. That’s due to a forecast of both lower fuel prices and lower heating demand.*
- The National Oceanic and Atmospheric Administration forecasts overall heating degree days this winter will be 7% lower than last winter and below the 10-year average.
*Source: Short-Term Energy and Winter Fuels Outlook, U.S. Energy Information Administration, 10-6-15.