With the price of oil changing at a rapid pace, it’s not just customers feeling the pinch – home heating oil companies are hurting, too.
For one local oil company, unsteady prices have been a major cause for concern as we enter the heating season.
For Lucas Santora, oil service runs in the family.
“The first truck I ever rode in in my life was an oil truck,” Santora said.
Get Connecticut local news, weather forecasts and entertainment stories to your inbox. Sign up for NBC Connecticut newsletters.
In 2018, Santora started his own company in the Middletown area, but this year, he’s shouldering the consequence of a volatile market.
“Before they make deliveries to their customers, the price might move 20, 40 cents a gallon, so prices that they promised their customers end up turning into losses when they actually deliver it,” said Connecticut Energy Marketers Association President Chris Herb.
After four years in business, Lucas Fuel recently suspended operations for the foreseeable future, citing this instability as the reason why.
Local
“The last thing I want to do after selling customers on a good service and something that’s dependable is tell them, ‘Hey, I’m not dependable right now and I can’t get to you,'” Santora said.
You might think higher oil prices means more money for companies like Lucas Fuel, but Herb said that’s far from the case.
“We make less money when prices are volatile and rising because of competition. When you have 600 fiercely competitive families trying to win their business, they have to shrink their margins to keep it,” Herb said.
It’s a problem many local businesses are facing, according to the Connecticut Energy Marketer’s Association, but for a business as small as Lucas Fuel, the impact is even greater.
“These are not the Exxon Mobiles of the world or the Shells that people are familiar with. These are your neighbors and again, in some cases, when they’re making deliveries they’re losing money,” Herb said.
And for Santora in particular, he said he’ll let things play out before possibly resuming service.
“At this point, I hope that if I do come back, people understand," he said.
Herb said that's due in part to OPEC’s recent oil production cuts, he doesn’t see prices leveling out soon.
