Heating Oil Prices Stabilize, Propane Supplies Tightening

February 2, 2017

Augusta, Maine – The Governor’s Energy Office (GEO) conducted its weekly heating fuel price survey on Monday, January 30, 2017, and found the current statewide average cash price for No. 2 heating oil was $2.28 per gallon, unchanged from two weeks ago. The average statewide kerosene price decreased a cent over the same time period, and now stands at $2.80 per gallon. Propane prices, however, have increased 7 cents, or almost 3% over the last two weeks. The average statewide price for propane (for heating customers) is now $2.53 per gallon.

Propane prices have increased recently due to increased global competition for domestically produced product. As recently as 2008, the U.S. imported 109,000 barrels of propane per day¹. However, propane is a by-product of shale oil and gas extraction, so propane production has increased along with oil and natural gas. And, with the construction of additional export terminal capacity over the last few years, the U.S. has now become a significant exporter of the fuel (see graph below).

Exports have begun to deplete surplus domestic propane inventories, illustrated below.

Stocks as recently as December 2015 were significantly above the five year average (in gray); now, we are well into five year average inventory levels. So, domestic consumption is facing increased pressure from abroad, as exporters can obtain a higher price on the global market. Domestic markets are facing higher prices as a result.

The following table compares the prices between various heating fuels, and converts these prices to a common heating unit value (dollars per million Btu).

Comparison of Heating Fuel Prices per Million Btu²


Fuel Price (in dollars) Fuel Price (dollars per million Btu)
Cord Wood ($250/cord) $11.36
Natural Gas ($1.49/therm) $14.91
Wood Pellets ($261/ton) $15.82
Heating Oil ($2.28/gallon) $16.44
Kerosene ($2.81/gallon) $20.74
Propane ($2.53/gallon) $27.70
Electricity (baseboard) (15-18 cents/kwh) $43.94-$52.75

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 January 30, 2017


Heating Oil

Statewide

Southwest

Central

Eastern

Western

Northern

Average

2.28

2.25

2.33

2.29

2.22

2.37

High

2.60

2.40

2.60

2.47

2.40

2.50

Low

2.00

2.05

2.05

2.05

2.00

2.30

Kerosene

2.80

2.84

2.83

2.79

2.74

2.83

Propane

2.53

2.53

2.59

2.43

2.45

2.71

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 found was $2.60, and the lowest heating oil price found was $2.00. 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 U.S. Energy Information Administration
² Does not factor in the efficiency of the heating system

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For Immediate Release

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