www.fueloilnews.com | FUEL OIL NEWS | march 2014 13
Highlights (Release Date: February 11, 2014)
• Temperatures east of the Rocky Mountains have been signifi-
cantly colder this winter (October - January) compared with the
same period both last winter and the previous 10-year average,
putting upward pressure on consumption and prices of fuels
used for space heating. U.S. average heating degree days were 12%
higher than last winter (indicating colder weather) and 8% above
the previous 10-year average. The Northeast was 11% colder than
last winter, the Midwest 17% colder and the South 20% colder,
while the West was 3% warmer.
• The cold weather has had the greatest effect on propane prices,
particularly for consumers in the Midwest. Residential propane
prices in the Midwest rose from an average of $2.08 per gallon (gal)
on December 2, 2013, to $4.20/gal on January 27; prices fell back
to $3.83/gal on February 3. EIA now expects that propane prices
in the Midwest will average $2.41/gal over the winter (39% higher
than last winter) while those in the Northeast will average $3.43/
gal (14% higher than last winter).
• While the North Sea Brent crude oil monthly average spot
price fell by almost $3 per barrel (bbl) from December to January,
cold temperatures have tightened heating oil supplies and helped
drive up retail prices. Weekly U.S. residential heating oil prices
increased by $0.14/gal between the end of December and end of
January. Despite the recent increases, EIA expects that U.S. heating
oil prices will average $3.82/gal this winter, $0.05/gal (1%) lower
than during last year's winter heating season.
• Cold weather also contributed to a new record-high with-
drawal of natural gas from storage and a surge in natural gas spot
prices. Natural gas working inventories on January 31 totaled
1.92 trillion cubic feet (Tcf), 0.78 Tcf below the level at the same
time a year ago and 0.56 Tcf below the previous five-year average
(2009-13). Henry Hub natural gas spot prices increased from
$4.32 per million British thermal units (MMBtu) on January 2 to
$5.66/MMBtu on January 27, before falling back to $5.04/MMBtu
on January 31. EIA expects that the Henry Hub natural gas spot
price, which averaged $3.73/MMBtu in 2013, will average $4.17/
MMBtu in 2014, an increase of $0.27/MMBtu from last month's
STEO. Residential natural gas prices are expected to average $10.16
per thousand cubic feet (Mcf) this winter, an increase of $0.41/Mcf
(4%) from last winter.
Fuels
eIA N e w s
short-Term energy Outlook
