While the low stock forecast adds some extra pressure to prices, crude oil cost is the major factor holding prices up this winter. The average retail price is about the same as last winter, but last winter included the price spike in January and February. Underlying crude oil prices are not expected to change much from this year to last. As those of you who watch the markets know, there is tremendous uncertainty in the amount of crude oil supply that will be available this winter.
Less supply means higher crude prices and thus higher heating oil prices.
Weather also adds to the uncertainty. If we have a normal winter this year, consumers will be buying more heating oil than last year.