Dear Neighbor,
1432 Wantagh ave.
Wantagh, NY 11793

Dear Neighbor,

Thank you for choosing Tragar Oil. As a valued customer we are pleased to announce that we are offering a new oil price program for 2009-2010. This letter is detailed; however I am convinced that this program is better than any offered before. Having done our research over several heating seasons, this concept will soon be how every company delivers oil.

LAST YEAR
Last fall, as oil prices were steadily climbing, it was impossible to predict that the recession and lower prices were around the corner. I made promises to provide fixed prices. I had to protect my promise with oil contracts for the entire season. We made many decisions together and they were the best possible at the time; and I appreciate everyone’s patience and loyalty as the past 12 months have been both challenging and memorable for all.

THIS YEAR
This Year the information we have is very different:

• Due to the lack of manufacturing and the continued economic recession, there is a surplus of stored oil not seen in over 20 years.
• This oil supply is maintaining the law of supply and demand.
• The current economy has proven that it simply cannot support high oil prices at this time.
• From World Oil Organizations to as recent as Newsday, oil is predicted to fall and remain low into 2011.

  NEW 2009-2010 Program : V.A.M.P.
Our new ‘Variable Average Market Pricing’ (V.A.M.P.) program offers you the opportunity to take advantage of the market rate of oil.

Before Capped and Fixed prices, oil companies delivered retail pricing. The retail price fluctuated day to day with the oil market. Our new average market pricing is similar; however the price will instead be based on a weekly average of the oil market published by NYSERDA. NYSERDA (New York State Energy Research and Development Authority) or www.nyserda.org publishes an unbiased report on the average oil price for Long Island each week. It has been quoted weekly in Newsday for several years.

Why not a cap price? Well, ever wonder why “cap price program” oil is usually delivered at the high end of the cap price? There is an added expense for all oil companies to purchase price protection. If we cap a client, we must cap ourselves, and a cap costs an oil company $.30 cents up front for every gallon we deliver to a client. (To demonstrate how important price protection is, it is mandatory and state law for oil dealers in CT, VT, NH and ME, to purchase oil price protection prior to writing contracts for fixed or capped customers).
This means, unless oil falls $.30 cents per gallon, the cap price doesn’t fall. Promises are made by every company, but the reality is, a cap today acts more like a fixed price. A fixed or capped price in this economy, in our opinion, is not your best choice.