With oil and gas systems being similarly efficient, the cost to convert is the bet on the future commodity cost. Many newer heating systems can be converted from burning heating oil to burning natural gas for $5,000 to $10,000. Older systems may cost more to convert, and should probably be replaced altogether. Savvy homeowners take into account the cost of the conversion in calculating their annual energy savings.
Using seven years as a horizon (the average time a US homeowner stays in one home before moving) you’d have to save at least $500 a year on your fuel cost, for seven years, just to break even. At today’s energy prices, where heating oil costs less than natural gas, that’s money you’d never get back. Increasingly warm winters have caused the payback period to increase even further (the warmer the winter, the longer it will take to make up the cost in future energy savings). On top of all that, natural gas furnaces may need to be replaced almost twice as often as home oil burners. When you add it all up, oil just equals good sense.