A total of 48 percent of U.S. homes will pay 30 percent higher bills for heating this winter, as 48 percent is the share of U.S. households that use gas as the primary fuel for space heating, the Energy Information Administration (EIA) said on Monday.
Higher retail natural gas prices will be the primary driver for the expected increase in natural gas heating expenditures this winter.
Retail prices have jumped because of the steady rise in the spot natural gas prices since last year’s winter, the EIA said. The U.S. benchmark price Henry Hub has more than doubled since the beginning of 2021, due to relatively flat U.S. dry natural gas production and surging liquefied natural gas (LNG) exports amid high demand and record LNG prices in Asia.
This winter, retail natural gas prices in the United States are expected to rise on average to $12.93 per thousand cubic feet (Mcf) from $10.17/Mcf last winter. This would be the highest price since the 2005–06 winter average, as per EIA data.
The largest increase in retail natural gas prices is set to occur in the Midwest, where prices would rise to $11.28/Mcf, up by 45 percent from last winter.
So, U.S. households that primarily use natural gas for space heating will spend an average of $746 on heating between October and March, which would be $172, or 30 percent, higher compared to last year, the EIA said.
The administration also projects higher energy bills for households using propane, heating oil, and electricity.
Compared with last winter’s heating costs, EIA expects U.S. households will spend 54 percent more for propane, 43 percent more for heating oil, 30 percent more for natural gas, and 6 percent more for electric heating. If winter temperatures are colder than expected, U.S. households will spend even more on heating bills.
By Tsvetana Paraskova for Oilprice.com
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