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US Households Face Higher Heating Costs and a Colder Winter

Published 10/13/2022, 02:02 AM
Updated 10/13/2022, 02:02 AM
© Reuters.

© Reuters.

(Bloomberg) -- US households are poised to spend considerably more on heat this winter, adding to already historic inflationary pressures.

Homes that rely on oil or natural gas for heat are looking at the biggest increases this winter, which is expected to be colder than last year, according to the Energy Information Administration. Heating using those fuels will be nearly 30% more expensive than last year, driving a 10% increase in overall electric bills. If the weather is even colder than expected, that increase could double.

The outlook comes as US households are already contending with higher prices for everything from gasoline to groceries. A global diesel shortage and strained natural gas inventories may compound the pain. US diesel supplies are at the lowest seasonal level on record, while gas stockpiles are 6% below the five-year average. The crunch will predominantly impact the US northeast, which has limited gas pipeline capacity and relies on diesel for heat.

Meanwhile, the agency forecasts that distillate fuels production will hold to last year’s level while the war and energy crisis in Europe limits imports to the East Coast.

 

©2022 Bloomberg L.P.

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