Oil price spike spurs home heat brainstorming sessions

Motivated by fears of a winter heating crisis, state and local officials are looking for ways to boost tax dollar-funded heating oil purchases for poor homeowners.Revere Ward 4 City Councilor George Rotondo wants his colleagues to ask state legislators and Congress to increase eligibility thresholds for individuals and families seeking assistance purchasing oil.Rotondo also wants Mayor Thomas Ambrosino to sponsor a “fuel assistance summit” with non-profit heating oil providers. The proposal parallels one by state Attorney General Martha Coakley to hold winter heating roundtables, including one scheduled for Friday, Oct. 3, 2008 from 9 a.m. to noon, in Salem Old Town Hall, 32 Derby Square.Rotondo and Coakley voiced their concerns Monday as oil prices spiked more than $14 a barrel as anxiety over the government’s $700 billion bailout plan battered the dollar and touched off frenetic buying of safe-haven investments including crude.Oil’s sharp gains came as energy traders grappled with the implications of the government’s proposed initiative to stem the U.S. financial crisis by absorbing billions of dollars of banks’ bad mortgage-related securities.Anxiety over the plan also sent stocks sharply lower Monday; the credit markets were calmer than they were last week, but still showing the effects of investors’ nervousness.There is still much uncertainty about what impact the U.S. rescue plan will have on energy demand. Oil’s run-up near $150 a barrel in July and a weak U.S. economy has forced Americans to cut back on their driving and led business to scale down operations.Though pump prices have eased from record levels above $4 a gallon, they remain expensive, and more softening in the economy would likely further curtail energy use in the world’s thirstiest consumer.”There are a lot of issues to be filled in. It’s an extraordinarily complex situation,” said David Moore, a commodity strategist at Commonwealth Bank of Australia in Sydney. “The market is digesting how the (rescue) package will work and the implications for the U.S. economy.”The winter heating discussions organized by Coakley focus on costs and health risks of rising energy costs. Participants hope to come up with practical solutions to help consumers get through the upcoming heating season.The series of roundtables follows a Sept. 17th New England Ratepayer Summit focusing on a prospective 40 percent to 50 percent increase in heating oil costs.Coakley’s office is responsible for monitoring oil rates and other energy costs. It plays an important role in mitigating energy rate increases by representing consumers in matters involving the price and delivery of natural gas and electricity before state and federal regulators.In 2007, lawsuits filed by Coakley’s office resulted in over $10 million in savings for consumers.Retail gasoline gas prices fell Monday as more Gulf Coast refineries ramped up operations following shutdowns forced by Hurricane Ike. A gallon of regular gas shed 1.8 cents overnight to a new national average of $3.739, according to auto club AAA, the Oil Price Information Service and Wright Express.(Material from The Associated Press was used in this report.)