Heating OilHeating OilBy: Artem Khmelyov

• Heating oil, or oil heat, is a low viscosity, flammable liquid petroleum product used as a fuel for furnaces or boilers in buildings

• The chemical formula for heating oil is HHO

• Heating oil is commonly delivered by tank truck to residential, commercial and municipal buildings

• It is normally stored in above-ground storage tanks which are located in the basements, garages, or outside adjacent to the building.

•Although sometimes it is stored in underground storage tanks

• The above ground heating tanks are used for small installations because of the low cost factor

•Heating oil is less commonly used as an industrial fuel or for power generation

Background…

Where heating oil is used...

Modern fuel efficient heating appliances which include;

• furnaces• boilers • water heaters • oil tanks • air conditioning systems • equipment protection plans • air quality solutions

* A major company that specializes in this product is Petro Canada

A Few Interesting Facts…•Comfortable – It produces the hottest flame of any home heating fuels, this means that it heats your house faster using less fuel

•Economical - it contains 138,690 BTU's (British Thermal Unit, which is a unit of energy) per gallon while Natural Gas contains 99,000 BTU's per therm. On average it takes 1.4 therms to equal the heat content of 1 gallon of heating oil. 

•Safe -compared to other heating sources heating oil is really safe, since it’s a liquid it can’t combine with air to form an explosive mixture which means there's no chance of explosions

•Clean – it’s a clear, rosy-red liquid that burns very clean. •The Environmental Protection Agency says that modern oil burners are one of the cleanest combustion sources available. Due to the Oil Heat's high BTU content, it costs less per unit of heat produced.

My Question...• How has the price of heating oil varied over the past 25 years?

• Start Point : 1986

• End Point: 2011

• Independent Variable: Temperature

• Dependent Variable: Heating Oil Cost

Hypothesis…• As the years go by, the cost of heating oil will increase due to the increase in colder temperatures. The temperature over the winter months will decrease making the weather conditions colder, this means that more heating oil will be used to heat homes in order to keep people warmer.

Years (1986 - 2011) Temperature (°C) Price

1986 -5.611111111 0.397142857

1987 -5 0.521666667

1988 -4.611111111 0.465833333

1989 -4.388888889 0.5575

1990 -4.888888889 0.688333333

1991 -2.833333333 0.614166667

1992 -3.944444444 0.573333333

1993 -5.222222222 0.526666667

1994 -7.722222222 0.494166667

1995 -3.444444444 0.495

1996 -6.055555556 0.631666667

1997 -2.777777778 0.563333333

1998 -1.666666667 0.393333333

1999 -2.611111111 0.488333333

2000 -3.944444444 0.8775

2001 -5.166666667 0.7125

2002 -0.611111111 0.680833333

2003 -6.833333333 0.8525

2004 -6.111111111 1.116666667

2005 -4.944444444 1.620833333

2006 -2.944444444 1.804166667

2007 -3.555555556 2.03

2008 -3.666666667 2.853333333

2009 -5.277777778 1.643333333

2010 -4.444444444 2.125

2011 -5.777777778 2.91

Heat Oil Cost vs Temperature y = -0.0264x + 0.9086

R2 = 0.0031

0

0.5

1

1.5

2

2.5

3

3.5

-9 -8 -7 -6 -5 -4 -3 -2 -1 0

Temperture (*C)

Heat

Oil

Cost

$

-1 (strong) -0.67 (moderate) -0.33 (weak) 0 (weak) 0.33 (moderate) 0.67 (strong) 1

R = 0.0556

Mean = -1.68112

Median = -0.10889

Linear Regression

y= -0.0264x + 0.9086

Standard Deviation

σ= 0.755441803

(U.S. dollar per gallon )

Heat Oil Price

0

0.5

1

1.5

2

2.5

3

3.5

1980 1985 1990 1995 2000 2005 2010 2015

Years

Pri

ce o

f H

eati

ng

Oil

Single Variable

Median - 0.65625

Mean - 1.024505

(U.S. dollar per gallon )

More Graphs…

-10

-8

-6

-4

-2

0

2

4

1 3 5 7 9 11 13 15 17 19 21 23 25 Temperature

Price of Heating Oil (U.S.Dollar per Gallon)

Sampling Techniques

Sampling Bias

• no sampling bias was found due to the fact that the data that was used was yearly weather temperatures and yearly cost for heating oil

• No regular sampling technique because the information for the raw data of heat oil was obtained from a New York Harbor No. 2 Heating Oil Spot

• While the raw data for the weather was obtained from the daily weather, which was archived daily

Hidden Variables - Climate change which could alter temperature that can cause an increase or decrease in heating oil use, which will in turn increase or decrease the price of the heating oil

- Financial state of the U.S. market, if the country is in a recession people could be forced to cut back on spending money for heating oil to heat their homes, and resort to other means of keeping warm with minimal house heating..- Global warming changes could affect the collected data due to the hotter summers, and the colder winters.

Conclusion• Restated Thesis - As the years go by, the cost of heating oil will increase due to the increase in colder temperatures. The temperature over the winter months will decrease making the weather conditions colder, this means that more heating oil will be used to heat homes in order to keep people warmer. •In conclusion my hypothesis is incorrect

•The temperature doesn’t play a role in the price of heating oil over a 25 year span

•Although the price of heating oil has increased drastically in the few recent years, this sudden change could be caused by the inflation of the global market

•Another theory: the government holds no control over the oil companies, hence while the price of oil stays the same, the refined product prices such as heating oil are being inflated by the oil companies in order to make a profit

Work Cited…• "Heating Oil Facts." Rossoe Energy Systems. N.p., n.d. Google. Web. 11 June 2011. <http://www.rossoe.com/dept.aspx?d_id=18017>.

• "Home Heating." Petro Canada. N.p., n.d. Google. Web. 11 June 2011. <http://www.petro-canada.ca/en/homeheating/3231.aspx>.

• "Heating Oil Monthly Price." Index Mundi. Google, n.d. Google. Web. 11 June 2011. <http://www.indexmundi.com/commodities/?commodity=heating-oil&months=360>.

• "Winter (Dec-Feb) Temperature New York." Climate At A Glance. N.p., June 2011. Web. 11 June 2011. <http://climvis.ncdc.noaa.gov/cgi-bin/cag3/hr-display3.pl>.