US homes using nat gas and propane will spend less this winter, EIA says

US households relying on natural gas or propane for heating will face lower energy bills this winter, according to the Energy Information Administration's (EIA) winter fuels outlook report. Homes primarily heated with natural gas are anticipated to experience a 9% decline in expenditures compared to the previous year, while those heated mainly with propane will see a 3% decrease.

Together, these two fuel types constitute roughly half of US households. The reduction in costs is partly due to ample natural gas inventories in the US, which are expected to enter the winter heating season at a 2% higher level than the average of the past five years. Limited price increases are projected due to robust production growth and relatively high inventories.

However, households using heating oil, which accounts for about 3% of US homes, primarily in the Northeast, will face a 21% increase in expenses compared to last winter. This is due to declining inventories of the fuel. The conflicts in Iran and Ukraine have severely disrupted diesel supplies, causing a global shortage that is expected to persist until next year. The EIA forecasts a 30% increase in heating oil prices, which could be tempered by milder weather in the Northeast during the winter months.

The EIA predicts that national winter temperatures will be similar to those of the previous winter and the average of the past 10 winters. National East Coast distillate stockpiles were 32% below their five-year seasonal average in September and are expected to remain between 20% and 30% below average throughout the winter. The agency forecasts that US homes will consume national average amounts of natural gas during the winter, with no change from last year.

Consumption of heating oil is expected to decrease by 9%, while propane consumption is projected to drop by about 1%.