Oil-Heated Homes to Face Steep Price Increases

Oil-heated homes will experience the steepest price increases this winter, according to recent national reports, while those heated by natural gas will see relatively stable prices.

According to projections released last month by the National Energy Assistance Directors’ Association (NEADA), prices for home heating oil are projected to be 28 percent higher than last year, rising from $2.42 per gallon on average last year to $3.10 this year.  The average family will pay about $402 more for home heating oil for a total of $1,834.  Propane prices are expected to increase by 28.3 percent, natural gas is expected to cost 6 percent more and electricity 7 percent.  NEADA’s press release is available on its website.

According to the Energy Information Administration’s (EIA) October winter fuels report, in the Northeast, where 32 percent of households use heating oil as their primary heating fuel, the average household is projected to pay 22 percent more than last winter as a result of a 16 percent increase in prices and a 5 percent increase in consumption.  EIA also said the average household using natural gas for heating can expect to pay 10 percent more than it did last winter, reflecting the combined effects of a 6 percent increase in price and a 3 percent increase in consumption.  However, the American Gas Association said it expects natural gas bills to be somewhat lower this winter due to ample supplies.

As crude oil prices reached over $88 per barrel on October 17, the average retail price of heating oil in Massachusetts hit a record $2.75 a gallon, up 3 cents from a week ago and 40 cents higher than it was last year at this time, according to a state survey reported in the Boston Globe.

Source: NEADA, EIA, Boston Globe

Page Last Updated: April 21, 2008