Griffith-Consumers Co., the Washington area's largest home heating oil supplier, raised its price a nickel a gallon this week, the latest and one of the largest in a series of price increases imposed here by heating oil distributors.
Griffith increased its price to 93.9 cents a gallon. The company had kept its price at 88.8 cents since early September, but Griffith president Walter Meighan said yesterday that higher charges imposed on the company by Griffith's oil suppliers had finally forced it to raise its price to customers.
Meighan said Griffith, which serves 40,000 Washington area customers, buys its No. 2 home heating oil from half a dozen suppliers and that all but the largest of those suppliers, Atlantic Richfield Co., had increased their wholesale prices since September.
Meighan and other Washington-area heating oil distributors said yesterday that prices will continue to escalate this winter as the oil-producing countries raise their prices for crude oil. Just yesterday Mexico raised its price for crude oil from $24.60 a barrel to $32.
"It all depends on crude oil," Meighan said. "It's a direct derivative.
If the crude prices haven't settled, then our prices haven't settled."
A Washington Post survey of 15 home heating oil distributors here shows that the average price had increased from 88.44 cents a gallon on Nov. 30 to 92.57 cents this week. Five of the 15 companies surveyed have raised their prices within the last week.
Oil distributors say they have no choice but to raise their prices to consumers as the major oil companies increase the wholesale charges.
"We pass through all the increases," said James Curtis, president of Metropolitan Fuels Co., the largest distributor in Montgomery County. "It's a normal penny-for-penny increase, but occasionally there also are increases from overhead" costs.
"We're hoping (the price) doesn't keep going up," he said. "But we never get any notice. The next phone call I get could be an increase," one that would go into effect at midnight the same day.
Texaco, Exxon USA, Gulf Oil Corp., Standard Oil Co. of Indiana and Standard Oil Co. of California have all raised their home heating oil prices between 3 and 6 cents a gallon since mid-December, as the Organization of Petroleum Exporting Countries raised their contract prices for crude oil.
Texaco was the latest to raise its prices, by 6 cents a gallon on New Year's Day, but that increase will have little impact on the Washington area since only about 3,500 homes in Prince George's County use Texaco's home heating oil, according to industry officials.
The Southern Maryland Oil Co., which buys Texaco oil, immediately raised its price to consumers from 89.9 cents to 92.9 cents a gallon after Texaco increased its wholesale price.
But Southern Maryland president J. B. Wills said the firm's price would be lower if it got all its from Texaco. He said the firm gets 62 percent of its oil from Texaco, the rest from Steuart Petroleum, which charges 90 cents a gallon to distributors.
Willis said that Southern Maryland did not raise its price to consumers when Steuart raised its price from 86 cents to 90 cents a gallon in mid-December. But when Texaco also increased its charge, "we just reached the point where we had to move," he said.
Most major all companies now charge distributors from 65 to 73 cents a gallon for home heating oil. The distributors then tack on an additional 20 cents or so to cover their costs and for profits.