WASHINGTON — Homeowners are expected to face higher prices to heat their homes this winter, according to projections in the U.S. Energy Information Administration’s (EIA) Short-Term Energy and Winter Fuels Outlook.
Compared to last winter, the EIA projects that residential expenditures for natural gas will increase by 13%, or an average of $80 more this winter heating season (Oct. 1 through March 31).
“The increase in natural gas expenditures represents a 14% increase in the average U.S. residential price from last winter, with consumption that is slightly lower than last winter nationally,” says the EIA. “The projected changes in residential natural gas prices this winter range from a 10% increase in the West, to a 15% increase in the Northeast.”
Despite its projection of higher natural gas expenditures this winter, the EIA says that it is still lower than the average of the previous five winters (October 2007 to March 2012).
Expenditures for propane are projected to increase 9%, while electricity will increase by 2%, the EIA reports. However, heating oil expenditures are expected to be 2% lower this winter.
Brent crude oil spot prices fell from a recent peak of $117 per barrel in early September to $108 per barrel at the end of the month, with the EIA attributing the cause to a restart in oil production in Libya, “and concerns over the conflict in Syria moderated.”
“EIA expects the Brent crude oil price to continue to weaken, averaging $107 per barrel during the fourth quarter of 2013, and $102 per barrel in 2014, the organization says.
West Texas Intermediate (WTI) crude oil prices are expected to average $101 per barrel during the fourth quarter of 2013, falling to $96 per barrel during 2014, according to the report.
Natural gas working inventories ended September at an estimated 3.52 trillion cubic feet (Tcf), 0.17 Tcf below last year’s level, and 0.04 Tcf above the previous five-year average (2008-2012), according to the EIA, which also expects the Henry Hub natural gas spot price to average $3.71 per million British thermal units (MMBtu) in 2013, and $4.00 per MMBtu in 2014.
Residential electricity prices are expected to increase by 2% in 2013, and 1% in 2014. The EIA attributes the “modest increases” to stable coal prices and an increase in electricity generation from coal.
To read the full report, visit www.eia.gov/forecasts/steo/index.cfm.