Energy costs rise amid global crunch
New York (CNN Business)Americans should expect to shell out more money to heat their homes this year — especially if it’s a very cold winter.
Compared with last winter, households will spend 54% more for propane, 43% more for home heating oil, 30% more for natural gas and 6% more for electric heating, the US Energy Information Administration said in a new report Wednesday.
The EIA expects home heating prices to rise across the country, for all heating fuels and under a variety of weather contingencies.
The forecast reflects a spike in energy costs, especially oil and natural gas. US oil prices recently closed above $80 a barrel for the first time since 2014. Natural gas, the most common fuel used o heat homes, has surged to prices unseen since 2008.
“As we have moved beyond what we expect to be the deepest part of the pandemic-related economic downturn, growth in energy demand has generally outpaced growth in supply,” EIA Acting Administrator Steve Nalley said in a statement. “These dynamics are raising energy prices around the world.”
Energy sticker shock is even more extreme overseas, especially in Europe, where natural gas prices have skyrocketed.
The situation is being amplified by forecasts for cooler-than-usual temperatures. The EIA noted that the National Oceanic and Atmospheric Administration expects a slightly colder winter this year than last year — and that in turn will drive up energy consumption.
“U.S. households will spend even more if the weather is colder than expected,” the EIA said in its report.
Americans are already dealing with sticker shock. Consumer prices increased 5.4% in September from a year ago, a Wednesday government report showed. That marks an acceleration from July and matches the fastest increase since 2008. Energy prices surged nearly 25% over the past year, including a 42% spike in gasoline and a 21% jump in utility gas service.
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