DOE hints at cold winter....
New York, Oct. 6 (Bloomberg) -- Higher crude oil prices and
cooler weather will boost U.S. home heating oil bills by
44 percent from last winter, the U.S. Department of Energy said.
This winter is expected to have lower temperatures than the
past two winters, boosting demand at a time when crude oil prices
are up 50 percent from a year ago, the DOE's Energy Information
Administration said in its October Short-Term Energy Outlook. The
two previous winters were among the warmest on record.
``There is a bit of apprehension about the winter,' said
Larry Chretien, executive director of the Boston Oil Consumers
Association, a 6,000-member buyers cooperative. ``We've already
had a little bit of a cold snap. People keep forgetting what it's
like when it's this cold this early. '
The nation's biggest home heating fuel, natural gas, will
also see higher prices, the EIA said. Prices for natural gas paid
to producers will be up 40 percent this year, though costs to
homeowners will be up only about 19 percent from the previous
heating season, the EIA said.
Natural gas consumption should be up 8 percent, and retail
prices will rise 10 percent over last year to $6.93 per 1,000
cubic feet, the EIA said.
Crude oil prices rallied this year after the Organization of
Petroleum Exporting Countries and independent producers reduced
world output by about 7 percent.
High crude oil prices mean ``product prices are going to be
a lot higher,' said Dave Costello, the economist in charge of
the report.
Heating oil prices should average $1.09 a gallon for New
England homeowners, up from 80 cents last winter, the DOE said.
Average consumption is expected to be up about 6 percent to
748 gallons for the season, meaning that homeowners' winter
heating oil bills for the season could average $230 higher than
last year.
``People view the last couple of years as gifts,' Chretien
said. ``Some people could be a little uncomfortable with prices
this year.'
At an average price of $1.09, the Boston co-op should be
able to save members 20 cents a gallon, Chretien said. The
current Massachusetts average price for heating oil is 95.5 cents
a gallon, while the co-op is charging between 84 cents and
89 cents. Last year, the co-op charged as little as 54 cents a
gallon.
The cooperative negotiates with local fuel dealers from the
Boston metropolitan area to negotiate prices below retail.
The Northeast is the nation's biggest market for heating
oil. The upper Midwest is the biggest market for gas used in home
heating. |
