Last updated: September 8, 2026
Heating oil prices are going crazy again.
In many parts of New England, heating oil is now close to or more than $5 per gallon. That means a 150-gallon delivery could cost around $750.
That is a big bill, and winter is not even here yet.
So, are wood pellets cheaper than heating oil? For many homeowners, the answer may be yes. This is especially true if you already own a pellet stove and can buy pellets at a fair price.
Let’s break down the numbers.
Current Heating Oil Prices in New England
Here are some recent heating oil prices:
| State | Recent Heating Oil Price |
|---|---|
| Maine | $5.15 per gallon statewide average |
| Massachusetts | $5.07 per gallon statewide average |
| New Hampshire | About $4.80 to $5.41 per gallon |
These prices will change. Your price will also depend on where you live, how much oil you order and which oil company you use. Some companies offer a lower cash price. Others may charge more for a small delivery. Still, one thing is clear. Heating oil is getting expensive.
Why Are Heating Oil Prices So High?
Heating oil and diesel fuel are made in much the same way. When diesel fuel is in short supply, heating oil prices can also go up.
Prices may rise because of:
- High crude oil prices
- Low fuel supplies
- Trouble at oil refineries
- Wars and world events (the current administration is not helping)
- Higher winter demand
- Delivery costs
- Very cold weather
Fuel supplies on the East Coast are also very low as we head toward winter.
Will heating oil keep going up?
I don’t know. No one knows for sure. Oil prices can rise or fall very quickly. That is why many homeowners are looking at wood pellets again.
Are Wood Pellets Cheaper Than Heating Oil?
To answer that question, we need to compare the amount of heat each fuel can make.
One ton of wood pellets has about 16 million BTUs of heat energy.
One gallon of heating oil has about 138,500 BTUs.
BTU stands for British Thermal Unit. It is simply a way to measure heat.
Your stove or furnace cannot turn all that energy into heat for your home. Some heat is always lost.
For this example, we will say that both heating systems are 80% efficient.
Using those numbers, one ton of wood pellets may provide about the same amount of usable heat as 115 gallons of heating oil.
This is only an estimate. Your results may be different.
What Does 115 Gallons of Heating Oil Cost?
Here is what 115 gallons of heating oil would cost at several prices:
| Heating Oil Price | Cost of 115 Gallons |
|---|---|
| $4.00 per gallon | $460 |
| $4.50 per gallon | $517.50 |
| $5.00 per gallon | $575 |
| $5.50 per gallon | $632.50 |
| $6.00 per gallon | $690 |
If heating oil costs $5 per gallon, 115 gallons would cost about $575.
That means a ton of pellets priced below $575 may give you the same amount of heat for less money.
Wood Pellet Savings When Oil Is $5 Per Gallon
Here is a simple wood pellet cost comparison:
| Pellet Price | Similar Amount of Oil Heat | Possible Difference |
|---|---|---|
| $300 per ton | $575 | $275 less |
| $350 per ton | $575 | $225 less |
| $400 per ton | $575 | $175 less |
| $450 per ton | $575 | $125 less |
| $500 per ton | $575 | $75 less |
If you can buy pellets for $350 per ton, you may save about $225 compared with the same amount of heat from $5 heating oil.
If pellets cost $450 per ton, you may still save about $125.
These are fuel costs only. There are other costs to think about.
A pellet stove uses a small amount of electricity. It also needs cleaning and service. You may have to pay for pellet delivery.
You will also need a dry place to store the pellets.
What Is the Break-Even Price?
The break-even price is where pellets and heating oil cost about the same for the amount of heat they provide.
Here are some examples:
| Pellet Price | Similar Heating Oil Price |
|---|---|
| $300 per ton | $2.61 per gallon |
| $350 per ton | $3.04 per gallon |
| $400 per ton | $3.48 per gallon |
| $450 per ton | $3.91 per gallon |
| $500 per ton | $4.35 per gallon |
If pellets cost $400 per ton, they may cost about the same as heating oil priced at $3.48 per gallon.
If heating oil costs $5 per gallon, those $400 pellets may be the better deal.
How Many Bags Are in a Ton of Pellets?
Most wood pellets come in 40-pound bags.
One ton contains 50 bags.
Here is the price per bag when buying by the ton:
| Price Per Ton | Price Per Bag |
|---|---|
| $300 | $6 |
| $350 | $7 |
| $400 | $8 |
| $450 | $9 |
| $500 | $10 |
Buying a full ton will often give you a better price.
However, do not buy a full ton of a new pellet without testing it first.
Buy five or ten bags and burn them in your stove. Check the heat, ash, fines and glass buildup.
A pellet that works great in one stove may not work as well in another.
Can a Pellet Stove Replace an Oil Furnace?
Sometimes, but not always.
Most pellet stoves heat the room where they are located. The heat then moves into nearby rooms.
If your home has an open floor plan, one pellet stove may heat a large part of the house.
If your home has many small rooms, closed doors or several floors, the heat may not travel as well.
You may still need your oil furnace for bedrooms, bathrooms and faraway rooms.
Many homeowners use a pellet stove as their main source of heat during the day. The oil system then runs as a backup or heats the rest of the house.
Even if the pellet stove does not replace all your heating oil, it may cut down how often you need an oil delivery.
Are Pellets Always Cheaper?
No.
Wood pellets are not always the cheaper choice.
It depends on:
- The price of pellets in your area
- The price of heating oil
- How well your pellet stove works
- How well your oil furnace works
- The quality of the pellets
- The size and shape of your home
- How well your home is insulated
- Pellet delivery charges
- How much heat reaches the rest of your house
Do not assume the cheapest pellet is the best pellet.
A cheap pellet may produce more ash, less heat or more buildup inside your stove. A better pellet may cost a little more but burn longer and require less cleaning.
Should You Buy Pellets Now?
If you already heat with pellets, it may be smart to start checking prices now.
Waiting until the first cold week can be risky. Popular brands may sell out, and delivery times may get longer.
Before buying a full ton:
- Call several local pellet dealers or find some good ones here.
- Ask about the delivered price.
- Find out which brands are available.
- Test a few bags in your stove.
- Check the bags for water damage.
- Make sure you have a dry storage area.
- Keep your oil system ready as a backup.
Do not panic and buy the first pellets you find. Compare the price and quality first right here on woodpelletreviews.com. Keep in mind, talk to the retailers because a lot of visitors on this site leave the negative reviews especially when they are not cleaning their pellets stove routinely.
The Bottom Line
Heating oil near $5 per gallon changes the math.
At that price, pellets costing between $350 and $450 per ton may provide the same amount of heat for much less money.
That does not mean every homeowner should replace an oil furnace with a pellet stove.
A new stove costs money. Pellets must be carried, stored and loaded. Pellet stoves also need power, cleaning and regular service.
But if you already own a pellet stove, using it more often could help lower your heating oil bill this winter.
Check out our wood pellet reviews before buying. You can compare pellet brands, read about heat and ash levels, and find pellets sold near you.
Frequently Asked Questions
Are wood pellets cheaper than heating oil?
They can be. When heating oil is around $5 per gallon, pellets priced below about $575 per ton may cost less for a similar amount of heat.
How many gallons of oil equal one ton of pellets?
One ton of pellets may provide about the same usable heat as 115 gallons of heating oil. This is an estimate based on both heating systems being 80% efficient.
How many bags are in one ton of pellets?
One ton contains 50 standard 40-pound bags.
How much does a ton of wood pellets cost?
Pellet prices depend on the brand, store, region and delivery charge. Always compare the final delivered price.
Should I buy pellets by the bag or by the ton?
Test a few bags first. If the pellets burn well in your stove, buying a full ton will often save money.
Will heating oil prices keep going up?
I don’t know. Oil prices can change quickly due to fuel supplies, weather, crude oil prices and world events.
