NEW YORK (AP) – Prepare to pay significantly higher heating bills this winter, apparently with everything in between.
With the global price of fuel oil, natural gas and other fuels soaring, the U.S. government said on Wednesday it expects households to see their heating bills increase by up to 54% from the previous year. last winter.
The largest increases are likely for homes that use propane, but others are also likely to experience large increases. Homes that use natural gas, which make up nearly half of all U.S. households, could spend $ 746 this winter, 30% more than a year ago. Homes using fuel oil could see an increase of 43%, and those heated with electricity could see a more modest increase of 6%.
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This winter is expected to be colder across the country than last year. This means people will likely burn even more fuel to warm up, on top of paying more for each piece.
The US Energy Information Administration forecast is the latest reminder of rising inflation plaguing the global economy. Earlier in the morning, the government released a separate report showing prices were 5.4% higher for U.S. consumers in September than a year ago. This is the highest inflation since 2008, as a waking economy and booming supply chains drive up prices for everything from cars to groceries.
The main reason for the increase in heating bills this winter is the recent surge in energy product prices after they fell to multi-year lows in 2020.
Natural gas in the United States, for example, hit its highest price since 2014 and is up about 90% from last year. The wholesale price of heating oil, meanwhile, has more than doubled in the past 12 months.
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One big reason is the way the economy has come back to life following the closures caused by the coronavirus, as well as the globalization of the fuel market. In Europe, strong demand and limited supplies have pushed natural gas prices up nearly 350% this year. This is pushing some of the natural gas produced in the United States towards ships destined for other countries, also adding upward pressure on domestic prices.
The amount of natural gas in storage stocks in the northern hemisphere is relatively low, according to Barclays analyst Amarpreet Singh, which means there is less cushion before the winter heating season.