Heating Oil Prices Are Exploding: Winter is coming. US families are more aware than ever that the cold weather season is approaching. Not because the weather itself is expected to be particularly different or significant this winter. But because energy costs are soaring and fuel supplies are tightening.
The Department of Energy is forecasting an intense rise in the cost of home heating relative to just last winter – no matter what you use to heat your home. Whether heating assistance programs will compensate sufficiently, allowing financially desperate families to heat their homes, remains unclear.
Europe is eyeing the winter months with similarly weariness, for similar reasons. Russia’s constriction of natural gas export has caused supply shortages and price increases. “Offices are getting chillier,” the AP reported. “Statues and historic buildings are going dark. Bakers who can’t afford to hear their ovens are talking about giving up, while fruit and vegetable growers face letting greenhouses stand idle.”
In Eastern Europe, which is generally less affluent than the rest of Europe, citizens are beginning to stock up on firewood. In wealthier European countries, like Germany, citizens are experiencing a six-month backlog for energy-saving heat pumps. The ongoing situation in Europe has the entire continent reconsidering their dependence on Russian energy.
A Home Heating Oil Crisis? Yes, as Prices Are Insane
Back in America, the National Energy Assistance Directors Association predicts energy costs will be the highest they’ve been in the last decade.
For the one-half of all Americans who rely on natural gas to heat their homes, the heating bill is expected to increase 28 percent this year. And for electricity users: 10 percent.
But for home heating oil, depending on the region you live in, you could be in for some severe sticker shock and hard choice ahead when it comes to your budget. The increased energy costs are expected to hit especially hard in New England – a region deeply dependent on heating oil. According to the U.S. Department of Energy, heating a typical home with heating oil this winter will cost $2,300. Many families don’t have the resources to cover a multi-thousand-dollar heating bill.
Over $5.00 a Gallon
Here is one example showing the massive increase over the last few years: the typical family in Rhode Island this year will pay over $5.00 a gallon for home heating oil. In the winter of 2019, before the pandemic, the price was around $2.79 – $2.99 per gallon (this can vary based on how much one buys). As one Ocean State resident told 19FortyFive: “I can’t afford to fill my tank. I would typically turn to electric heaters, which helped a lot last year. However, the electric bill keeps going up and up. Honestly, I am not sure what I will do now.”
Maine resident Aaron Raymo, for example, began stockpiling heating oil over the summer. Gradually, Raymo filled up a 275-gallon oil tank in preparation for the winter crunch. For Raymo, and millions of other Americans, the increased energy costs may force a difficult decision: heat or food.
“It’s a hard one,” Raymo said, “What are you going to choose for food, or what amount of fuel oil are you going to choose to stay warm.”
Another example drives home the price spike. In Maryland, according to the price tracking site YCharts, “[R]esidential Heating Oil Price is at a current level of 5.747, up from 5.436 last week and up from 3.379 one year ago. This is a change of 5.72% from last week and 70.08% from one year ago.”
Can The Government Help?
Last month, the US Congress added $1 billion in funding to the Low Income Home Energy Assistance Program. The LIHEAP now has $4.8 billion total funding. It sounds significant. But last year, LIHEAP had a pooled $8 billion, thanks to federal pandemic relief funding. So this year’s total amounts to just over half of last year’s funding. Mark Wolfe, the executive director of NEADA, believes that LIHEAP will not be enough to provide adequate assistance this winter.
“The crisis is coming,” Wolfe said. “There’s a lot of uncertainty and factors in play that could drive these prices higher.”
Harrison Kass is the Senior Editor at 19FortyFive. An attorney, pilot, guitarist, and minor pro hockey player, he joined the US Air Force as a Pilot Trainee but was medically discharged. Harrison holds a BA from Lake Forest College, a JD from the University of Oregon, and an MA from New York University. He lives in Oregon and listens to Dokken. Follow him on Twitter @harrison_kass.