Heating Fuel Prices Settling Amid Weeks of Volatile Crude Prices

November 17, 2016

Augusta, Maine – The Governor’s Energy Office (GEO) conducted its weekly heating fuel price survey on Monday, November 14, 2016, and found the current statewide average cash price for No. 2 heating oil was $2.02 per gallon, down a penny from last week. The average statewide kerosene price also dropped a cent from the week before, now at $2.53 a gallon. Average statewide propane prices remained the same as last week, $2.29 per gallon.

After several weeks of price fluctuations – first up, then down, this week’s average prices are very similar to last week. The Organization of Petroleum Exporting Countries’ (OPEC) late September announcement to curtail production has caused some volatility in global markets. Crude prices increased to well over $50 per barrel, only to drop once again when doubts began to surface regarding OPEC’s ability to implement agreed upon production limits http://www.bloomberg.com/news/articles/2016-11-14/opec-said-to-start-final-diplomatic-push-to-heal-oil-cut-divide . As the graph below shows, oil production has continued to climb despite the verbal agreement to halt further increases.

However, crude oil prices have edged up slightly over the last couple of days amid a possible Russia-Saudi Arabia agreement to cut output, in light of higher than expected U.S. crude inventory figures http://www.reuters.com/article/us-global-oil-idUSKBN13A068 For Maine households, this means spot market prices for heating fuels are likely to continue fluctuating, at least until OPEC reconvenes late this month.

Using this week’s average heating oil price ($2.02), and converting to a common heating unit value (million Btu), the price of fuel oil is $14.56. This compares with an equivalent heating unit value for cord wood of $11.36 (at $250/cord); natural gas of $14.14¹ (at $1.41/therm); wood pellets, $15.82 (at $261/ton); kerosene $18.74 (at $2.53/gallon); propane, $25.07 (at $2.29/gallon); and electricity (electric baseboard), $38.10 to $55.69 (at 13-19 cents per kwh). However, fuel prices are only part of the calculation when determining which fuel will save you more money over the course of a heating season. The type of heating system, as well as its efficiency, is also an important factor in determining final costs. The Energy Office has a calculator on its web site that allows consumers to explore these fuel options further, as well as compare efficiencies of heating systems most closely matching their own system. 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 . Efficiency Maine also has a calculator on its website that can help consumers evaluate their heating options http://www.efficiencymaine.com/at-home/home-energy-savings-program/heating-cost-comparison/

As of November 14, 2016


Heating Oil

Statewide

Southwest

Central

Eastern

Western

Northern

Average

2.02

1.98

2.07

2.01

1.98

2.16

High

2.25

2.20

2.25

2.15

2.19

2.20

Low

1.78

1.78

1.80

1.78

1.80

2.15

Kerosene

2.53

2.59

2.53

2.49

2.48

2.60

Propane

2.29

2.29

2.30

2.21

2.26

2.42

The price for heating oil is a statewide average; 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 ($2.25) was found in one region in the state, and the lowest heating oil price ($1.78) was found in two regions. Also, the statewide average price for propane is based on consumption 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.


¹ natural gas prices reflect some non-peak heating season supply costs; prices will be higher as the heating season progresses

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For Immediate Release

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