| A question often asked is "why is home heating oil not | | | | For the UK, including Northern Ireland, the big question |
| the same price as it was when crude oil was this | | | | should not be how many dollars a barrel of oil is but |
| price?". | | | | how many pounds a barrel of oil is. Although the crude |
| Such a question made headlines in NI (Northern Ireland) | | | | oil price has dropped quite a bit, consumers haven't got |
| in late 2008. A home heating oil website that monitors | | | | the full benefit of it because oil is priced in dollars and |
| the cheapest oil in Northern Ireland looked into whether | | | | the pound has been weak recently against the dollar. |
| there is a case to answer. | | | | For example, anything that cost US$45 would translate |
| There may be discrepancies but the biggest reason | | | | as £22 in the summer but cost £30 now so the |
| for the difference is in the exchange rates (as oil is | | | | exchange rates have been working against the price |
| priced in dollars). | | | | drops of oil. |
| In November 2007, $64 would have been just over | | | | However there is only so far it can go. Oil distributors, |
| £30. In November 2008, $64 would be around £40. | | | | including those in Northern Ireland, would be quick to |
| This sort of difference alone would mean oil priced at | | | | point out that they sell kerosene, not crude oil and that |
| £300 in Northern Ireland one year could cost £400 | | | | other cost factors need to be taken into consideration. |
| the following year in Northern Ireland. | | | | If the price of a barrel of oil was free, that doesn't |
| If the price of crude oil remains steady and the pound | | | | mean someone is going to get it refined into kerosene |
| gains strength against the dollar then there is no | | | | and deliver it to your house for free. There are costs |
| reason why we can't see even cheaper home heating | | | | that are going to be more static than the stock market |
| oil. | | | | prices. |