No. 2 Heating Oil and Kerosene Prices Level Off, While Propane Continues to Rise

Augusta, Maine – The Governor’s Energy Office (GEO) conducted its weekly heating fuel price survey on Monday, January 13, 2014, and found the current statewide average cash price for No. 2 heating oil was $3.81 per gallon, standing at the same average price as last week. The average statewide price for kerosene is up one cent, to $4.21 per gallon. Propane prices, statewide, continue to rise significantly; this week’s average statewide price (for heating customers) is up another eight cents, to $3.25 per gallon. Heating fuel prices have risen 28 cents (heating oil), 27 cents (k-1), and 60 cents (propane) per gallon since the heating season began in October. Last year at this time, heating oil averaged $3.71 per gallon; kerosene, $4.14, and propane, $2.72.

Warmer weather and a dip in crude oil prices following the ease of economic sanctions with OPEC’s fifth-largest oil producer, Iran, help both kerosene and No. 2 heating oil combat a trend of rising prices due to increased demand. The ongoing shortage in propane inventory means higher prices yet again; however, Maine’s statewide average price is below New England as a whole. This is little comfort to most Mainers, who struggle to pay expensive heating bills.

Maine Average Prices vs. New England Average Prices

Source: GEO and EIA

Heating Oil

Propane

Date 12/30/13 01/06/14 01/13/14 12/30/13 01/06/14 01/13/14
New England 4.04 4.02 4.00 3.39 3.40 3.50
Maine 3.76 3.81 3.81 3.06 3.17 3.25
Difference .28 .21 .19 .33 .23 .25

The charts below illustrate the tight supply situation for propane; stocks are at levels well below their five year average, and 23.1% below last year. Crude oil prices have fallen for the first time since early last month, which may account for the heating oil prices remaining the same as last week. Crude oil accounts for roughly 65% of the cost of heating oil, so the performance of crude oil stocks and crude oil prices can be a good indicator of heating oil prices. Unlike propane, heating oil inventories are adequate in the region.

Regional Propane Stocks

Regional Distillate Stocks

Using this week’s average heating oil price ($3.81) and converting to a common heating unit value (million Btu), the price of fuel oil is $27.47. This compares with an equivalent heating unit value for natural gas of $15.50 (at $1.55/therm); propane, $35.58 (at $3.25/gallon); kerosene $31.19 (at $4.21/gallon); wood pellets, $14.67 (at $242/ton); cord wood, $11.36 (at $250/cord) and electricity, $43.96 (at 15 cents per kwh). These fuel-only prices do not take into account the type of heating system, nor its efficiency. For example, the electricity cost is for traditional baseboard heat. Other electric heating technologies, such as heat pumps and electric thermal storage (ETS), may offer consumers energy savings. Cold climate heat pumps, a recent technological advancement, are much more efficient than baseboard electric heat, so total energy costs are lower than many other types of heating fuels. ETS offers savings by utilizing off-peak electric rates, available in many areas of the state.

The Energy Office has a calculator on its web site that allows consumers to obtain more detailed estimates of home heating costs, and the price impacts of various types of fuel, heating systems and heating appliances. Heating costs vary considerably from home to home. The home heating calculator can assist homeowners in finding the best heating option for their home, location, lifestyle, and budget http://www.maine.gov/energy/index.html

As of January 13, 2014


Heating Oil

Statewide

Southwest

Central

Eastern

Western

Northern

Average

3.81

3.80

3.82

3.81

3.80

3.84

High

4.06

3.99

4.06

3.96

4.00

3.85

Low

3.61

3.70

3.70

3.61

3.66

3.80

Kerosene

4.21

4.19

4.23

4.21

4.19

4.24

Propane

3.25

3.27

3.29

3.26

3.13

3.34

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 highest heating oil price ($4.06) was found in one region in the state, and the lowest heating oil price ($3.61) was also recorded in only one region. 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 Trust 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