---

Steve Shumila was planning to use his $900 federal economic stimulus check to buy new mattresses for his house.

But then, he filled up his truck with gasoline to the tune of $100 and got a delivery of heating oil costing another $800.

That was that, he decided.

"I said, 'I'll just have to hold off on the mattresses.'"

Shumila, a North Attleboro resident, said he - like everyone else - has seen the price of gasoline jump up and up, but he was shocked to hear of the cost of heating oil. A year ago the price was about $2.50 per gallon. Now it is above $4.50.

What is worse, at a time of the year when most homeowners usually sign up for price cap protection plans for the distant winter, industry analysts say most oil dealers aren't offering the caps because of the roiling market.

And it's anyone's guess how high heating oil prices will go, once winter finally arrives.

Even the warm weather of summer has failed to bring relief.

The cost of heating oil traditionally goes down after winter is over because usage goes down. This year, however, the price has continued to rise during May and June.

Filling a 250-gallon household tank can cost more than $1,000.

Phil Giudice, commissioner of the state division of energy resources, said the cost of heating the average home with oil has gone from $1,100 five winters ago to $2,500 last winter. At current prices, it will cost an estimated $3,500 or more.

"The run up in price has been totally remarkable and unprecedented," he said.

The near doubling of heating oil prices in one year has customers like Shumila asking why.

He wants to know what is causing the spike, and who is benefiting. Joe Santoro, president of Santoro Oil and Attleboro and Plainville Oil, assures customers it is not his fault.

He said he is making about 20 cents per gallon, the same margin he has been earning for years. Also, he said his losses from extending credit to customers who end up defaulting is on the rise, making his business more volatile.

Santoro points the finger of blame at Wall Street speculators who manage hedge funds.

He said the speculators buy up oil on the commodity market and then go on cable television news shows predicting the price of oil will go way up.

Prices jump as a result, and speculators make a big profit based on their own predictions, he said.

"These speculators are killing this country. They are self-created lions chewing up the consumer," he said.

Michael Ferrante of the Massachusetts Oil Heat Council agrees.

The cost to dealers has been escalating just as it has for homeowners, he said.

The wholesale price for heating oil was $3.81 a gallon last week, while the cost to homeowners was $4.50.

Ferrante said the role of speculators has driven up the price of oil far beyond the normal laws of supply and demand, putting the economy at risk.

"The typical buying and selling pattern has been blown out of the water. It is reaching crisis proportions. The dealers feel as helpless as the customers do," he said.

Congress has been holding hearings on the role of speculators and is considering regulations to deal with the situation.

Giudice, of the state energy division, said Wall Street plays a part in the rising price of oil, but the problem is more complicated than that.

He said instability in oil-producing regions such as the Middle East and Nigeria, growing demand in developing countries like China and the anticipation that demand will outstrip supply in the future all contribute to high prices.

While the entire country suffers from high gasoline prices, New England is particularly hard hit by surging heating oil costs.

The federal Department of Energy says most of the country uses less expensive natural gas to heat homes. About 80 percent of homes that heat with oil are in the Northeast, which the department defines as New England, New York and the mid-Atlantic states.

There are about 107 million homes in the United States, according to the department, and only 8.1 million heat with oil.

Giudice said New England uses relatively little natural gas because there is less infrastructure here to support the industry.

Natural gas use started in regions surrounding oil fields because it was easy to pipe it to customers.

There are no oil fields in New England, so the use of natural gas was slow to come to the region, he said.

New England relies on oil because it is easy to ship to the many ports in the Northeast.

Giudice said natural gas is about 25 percent cheaper than heating oil right now, but his agency is not recommending that households switch to gas.

The conversion is expensive, he said, because the customer has to dispose of the oil tank, connect to a gas line and buy and install a gas burner.

Furthermore, gas historically has not always been cheaper than oil.

Gas has been less expensive for the past two years, but the cost is expected to go up, he said.

Giudice said he recommends that homeowners thoroughly insulate and weather strip their homes, instead, which can reduce usage by 25 to 30 percent.

He also said it may be cost-effective to buy a new, more efficient oil burner.

If a new burner increases efficiency over an old burner from 70 to 95 percent, a typical homeowner can save $1,000 a year. That means a $4,000 burner would be paid for in four years, he said.

While Shumila and other homeowners wonder what hit them, the experts say there is no hope for better days ahead.

Ferrante said dealers cannot afford to offer price protection plans such as caps at this time because they do not know what their costs will be.

Giudice said he suspects he knows.

"We can expect very high prices for the future," he said.