Maine Heating Oil Prices Continue Falling as Forecasts for Global Economic Growth Scaled Back

April 18, 2013

Augusta, Maine – The Governor’s Energy Office (GEO) conducted its weekly heating fuel price survey on Tuesday, April 16, 2013, and found the current statewide average cash price for No. 2 heating oil to be $3.55 per gallon, down another three cents from last week’s price survey, and almost 30 cents lower than the season’s peak price recorded in mid-February. The average kerosene price also fell four cents, to $3.99 per gallon, a price not seen for the entire heating season. Propane prices fell as well; this week’s average statewide price was $2.73 per gallon, down four cents from last week.

According to Bloomberg news, both a strong dollar and diminished global economic growth forecasts resulted in falling prices for many commodities, including crude oil http://www.bloomberg.com/news/2013-04-17/commodities-drop-the-fifth-time-in-six-days-on-outlook.html On Wednesday, the International Monetary Fund revised its 2013 global economic growth forecast downward for the fourth time. This forecast, coupled with a strong dollar, led to price declines for both West Texas Intermediate (WTI) and Brent crude oil. Brent crude traded at its lowest price since last July. This morning, both types of crude regained some of that loss. http://www.bloomberg.com/news/2013-04-18/wti-crude-drops-fifth-day-in-six-iran-considers-opec-meeting.html

Using this week’s average heating oil price ($3.55) and converting to a common heating unit value (million Btu), the price of fuel oil is $25.60. This compares with an equivalent heating unit value for natural gas of $17.00 (at $1.70/therm); propane, $29.89 (at $2.73/gallon); wood pellets, $14.55 (at $240/ton); cord wood, $10.50 (at $210/cord) and electricity, $43.96 (at 15 cents per kwh). The electricity cost is for traditional baseboard heat. Heat pumps, a recent technological advancement, are much more efficient, so total energy costs are lower than oil, kerosene, or propane.

The GEO has a calculator on its web site that allows consumers to estimate home heating costs and price impacts of various energy sources. See http://www.maine.gov/energy/index.html . Efficiency Maine Trust also has an interesting chart homeowners can use to compare costs of specific heating options http://www.efficiencymaine.com/pace/compare-heating-options

As of April 16, 2013


Heating Oil

Statewide

Southwest

Central

Eastern

Western

Northern

Average

3.55

3.49

3.65

3.60

3.54

3.73

High

3.80

3.65

3.75

3.80

3.68

3.75

Low

3.26

3.26

3.44

3.26

3.26

3.64

Kerosene

3.99

3.97

4.12

4.03

3.96

4.13

Propane

2.73

3.19

2.82

2.58

2.75

3.14

It is important to note that the price for heating oil is a statewide average, and that prices in a given geographic region of the state may be considerably higher or lower than this average. This week, within the Energy Office sample, the lowest heating oil price of $3.26 was found in four regions of the state, and the highest of $3.80, in only one region of the state. Also, the statewide average price for propane is based on a use of at least 900 gallons a year. Households using propane just for cooking or hot water generally pay a higher per gallon price. The table above provides current Maine cash prices in dollars rounded to the nearest penny.

Efficiency Maine links Maine homeowners and businesses with qualified, certified contractors who provide access to energy improvement options. For program details call 866-376-2463 or visit www.efficiencymaine.com.

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For Immediate Release

Contact:
Lisa Smith
(207) 624-7445
lisa.j.smith@maine.gov