High propane inventories lower residential prices to start winter

Residential propane prices during the first two weeks of the current winter heating season were 4 percent lower than during the same time last winter, according to the U.S. Energy Information Administration (EIA).

Lower residential propane prices to start winter were the result of inventories that were near the high end of the five-year (2015-19) average and a decrease in crude oil prices since last year at this time, EIA says.

According to the U.S. Census Bureau’s 2019 American Community Survey, propane is the primary home heating fuel in 5 percent of U.S. homes and tends to be more common in the Northeast and Midwest. At least 14 percent of homes in Vermont, New Hampshire, South Dakota, North Dakota and Montana use propane as their primary heating fuel.

In its Winter Fuels Outlook, EIA expects households that use propane as their primary source of heating fuel to spend 14 percent more on average for heating this winter compared with last winter because EIA expects higher propane prices and more demand for space heating.

Propane prices are generally highest in the New England region and lowest in the Midwest. Of the states surveyed in EIA’s Heating Oil and Propane Update, as of Oct. 19, residential propane prices ranged from $1.09 per gallon in Nebraska to $3.75 a gallon in Florida.

The Heating Oil and Propane Update is published as part of the State Heating Oil and Propane Program, a joint effort between EIA and several state energy offices to collect state-level residential heating oil and propane price data from October through March in states where heating oil and propane use is common.

Featured photo: LP Gas staff