US heating oil costs may rise by 21% — CNBC
In the United States, households that heat their homes with heating oil may spend 21% more during the winter season than last year. According to a forecast by the US Energy Information Administration (EIA), average spending by these consumers from November through March will amount to $2,115.
As CNBC reports, the average price of a gallon of home heating fuel is expected to reach $5.26 this winter. This is 34% higher than last winter. The EIA also forecasts a warmer winter, which could somewhat reduce fuel consumption.
Tight distillate fuel market
Prices are rising amid tight conditions in the global distillate fuel market, which includes diesel and heating oil. Andy Lipow, president of consulting firm Lipow Oil Associates, linked the limited supply to disruptions at oil refineries in Russia and the Middle East, as well as reduced fuel exports from China.
The sharpest price increase will affect the northeastern United States, where heating oil use is most widespread. It is used to heat homes in about 3% of US households. Approximately 3.4 million of the 4.1 million such households are located in this region.
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According to the EIA forecast, heating oil consumption may decline by 9% due to warmer weather, but household spending will rise because of higher prices. Actual bills, the agency notes, will depend largely on air temperatures during the winter.
Prices in individual states
In Massachusetts, as of October 5, the average retail price of a gallon of heating fuel was $6.12, approximately 73% higher than a year earlier. In Maine, the average price reached $5.96 per gallon, about 79% above last year's level.
For households using other heat sources, the EIA forecast is more favorable. Spending on natural gas is expected to amount to $640, 9% less than last year; propane spending is projected at $1,246, or 3% less. At the same time, average spending on electric heating is forecast at $1,196, 4% more than last year.
