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market price, pre-buy, and cap price

Which Should I Choose? Market Price, Pre-Buy, and Cap Price

A home delivery service for heating oil ensures your tank is full before winter hits. You can schedule regular shipments or request on-demand deliveries to keep your home warm and cozy. When planning a heating oil or propane home delivery service, you’ll have to decide what kind of pricing plan works best for you.

You have several options when it comes to pricing plans, each of which offers unique advantages. Learn about heating oil pricing plans and decide which will best meet your needs and priorities.

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Comparing Home Energy Pricing Plans

Everyone’s heating needs are unique. That’s why it’s a good idea to explore propane and heating oil pricing options. Choosing the right pricing plan option allows you to enjoy savings. Since everyone’s home is different, the best plan for you might not be the same as the best for someone else. A new or well-maintained oil tank will be more efficient — if you aren’t sure about the condition of your current oil tank, schedule an inspection before choosing a new service plan.

Market Price vs. Pre-Buy vs. Cap Price

Fuel oil pricing plans may or may not depend on the current heating oil market. You can pre-buy for heating oil price protection or choose a plan that will allow you to enjoy market price dips. Here are the three basic pricing plans for heating oil and propane:

1. Market Price

The simplest propane pricing option is a market price plan, where your rates will reflect the current market price. As market rates rise and fall, your costs will do the same. Just like the stock market, the cost of propane and heating oil fluctuates from one day to the next. A market price plan means there’s no cap on how high or low your rates can go.

A market price plan has pros and cons. If market rates fall, you’ll enjoy savings. However, you also risk paying higher prices if the market moves in the other direction. Several factors influence the price of propane, including:

  • Crude oil and natural gas prices.
  • Where supply is located and obstacles of retrieval.
  • Production and availability.
  • Inclement weather or natural disasters.
  • Cyclical demand periods.

In other words, several elements beyond your control affect how much you pay per gallon of propane or heating oil. Choosing a market price plan has inherent uncertainty but could reward you with occasional lower prices.

2. Pre-Buy

Another option for your propane pricing plan is to lock in your rates by pre-buying. Basically, you’ll purchase your heating oil before the high-demand season begins. That way, you’ll pay the same amount no matter how much rates fluctuate throughout the season. Pre-buying can be a strategic way to ensure your per-gallon prices never rise. However, it also keeps your per-gallon prices from ever falling. Even if market rates dip below your rate, you’ll not get to enjoy those lower prices.

Pre-buying is a good option if you want your heating oil prices to be predictable and standard. The only risk it incurs is potentially barring you from lower prices — but buying during periods of low demand means you’re more likely to access the lowest possible prices, anyway. Pre-buying also gives you a chance to plan ahead. You’ll be able to take care of your heating oil expenses before winter, so you can rest easy when the cold months hit.

cap price

3. Cap Price

A cap price plan is the best value option. You get the best of both worlds, including the perks of a fixed rate along with the perks of a market-based rate. A cap limits how far your prices can rise but does not stop them from falling. As market rates fall, you’ll enjoy those savings. As market rates rise, you’ll never pay more than your pre-determined cap price.

In that way, a cap price plan protects you from surging prices while giving you access to falling prices. Cap-price plans offer propane price protection along with savings. Cap-price plans might involve a service fee to cover your provider’s insurance expenses.



Shop for the Best Heating Oil and Propane Pricing Plans at Shipley Energy

Choosing the right pricing plan can greatly affect how much you pay for your propane or heating oil. It’s essential to understand various pricing plan options and how they work. Here at Shipley Energy, we strive to help homeowners like you make informed decisions for their energy and heating needs. You can use our tool to help you shop for the best heating oil and propane pricing plan.

We’ll also help you decide when it’s best to lock in your price, as the market fluctuates constantly. If you’re uncertain about making a switch, choosing your own energy plan often allows homeowners to amass serious savings. To learn more about residential energy, browse our resource center.

You’ll find that the pricing plan is just one aspect of what you should consider when choosing a heating oil company. You’ll also want to think about things like:

  • Customer service.
  • Emergency support availability.
  • Transparency.
  • Reliability.
  • Tank services.
  • Community involvement.
  • Rewards programs.

Be sure to consider all of your options when choosing a new heating oil supplier and pricing plan. At Shipley Energy, we can help you make the best choice for your property.

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Contact Shipley Energy for More Information

The cost of heating oil fluctuates like the stock market, which is why it’s so important to choose the right pricing plan. Paying market prices comes with some risk since your rates could rise without limit, but it also allows you to enjoy the market’s lowest moments. Pre-buying is a type of fixed price. Your prices will not rise with the market, so buying when prices are low is a strategic option. The best value plan is a cap price plan, which lets you pay low rates without risking high rates.

As you can see, choosing an energy supplier can be a complex process involving a lot of important decisions. If you have the freedom to choose the right supplier, it’s vital to make the smartest possible choice. At Shipley Energy, we provide the resources and support to help you make the best decisions for your home energy needs. Use our tool to shop for the best heating and oil prices, or contact us for more information. Reach out using our online form or give us a call at 1-800-839-1849. We’re excited to connect!

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Peggy H.

Always helpful staff and on time for any appointments scheduled. We have never been left without oil.

Peggy H.
Paula M.

Thank you Shipley oil.  Had a friend in dire need for oil.  I arranged to have oil delivered on a Friday afternoon told them she had a house full of kids, including a newborn.  They had oil in her tank in less then 24 hours.  You folks rock!

Paula M.
Stephanie M.

Shipley Energy is the best we've had for our heating oil! Best prices, fast service when we needed it and even next day delivery when we were low! Highly recommend!!

Stephanie M.
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