U.S. home heating bills seen much higher this winter, EIA says

A torch burns excess natural gas in the Permian Basin in Loving County, Texas, the United States, November 23, 2019. REUTERS / Angus Mordant

October 13 (Reuters) – US consumers will spend more this winter (October-March) to heat their homes than last year, largely due to higher energy commodity prices, the US Energy Agency forecast in its Winter Fuels Outlook on Wednesday .

Households that use propane and heating oil are likely to spend a lot more than they did last year, EIA said.

EIA said it based its cost estimates on expectations of high retail energy prices – many are already at multi-year highs – and on projections for slightly colder weather this winter, which will increase household energy use compared to last year.

In the past year, many energy prices hit multi-year lows due to the destruction of demand by the coronavirus. The wholesale price of natural gas, the most widely used heating fuel in the United States, averaged just $ 2.11 per thousand cubic feet (mcf) in 2020, the lowest in 25 years.

The main reason the wholesale prices of natural gas, crude oil and petroleum products are soaring is that fuel demand has grown faster than supply from recent lows, in part due to the post-pandemic economic recovery, EIA said.

Depending on where the rural people live, the EIA said the cost of housing this winter – residents’ cost is higher than wholesale prices – to around $ 11-14 per mcf for natural gas, about 2.50-3, Will rise to $ 50 a gallon for propane and nearly $ 3.50 per gallon for heating oil.

That compares to last winter’s housing costs of about $ 10 to $ 12 per thousand cubic feet for natural gas, $ 1.50 to $ 2.50 per gallon for propane, and $ 2.50 per gallon for heating oil.

The EIA said it would provide more details when it releases its short-term energy outlook later on Wednesday.

Reporting by Scott DiSavino; Editing by Andrew Heavens and Jonathan Oatis

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