Winter's home heating outlook: lots of fuel, less chilling price hikes

Thanks to appreciable energy conservation through the first eight months of 1980, Americans can anticipate a warm, snug winter with ample fuel supplies to heat their homes.

In making this projection, government and private energy analysts also say the outlook is for less-chilling price increases during the winter of 1980-81 than those posted last winter.

The most vivid contrast with last year is in the nation's supply of home heating oil. Last fall, during the season when US refineries reduced gasoline production in favor of heating oil to meet winter demand, the country had in storage 195.3 million barrels of distillate fuel oil, which include diesel fuel and home heating oil.

The latest figures from the US Department of Energy (DOE) show the United States with distillate stocks of about 223 million barrels as of Aug. 29.

"White these high inventories, we don't see any problem at all covering the demand this winter," said Charles hill, an official with Phillips Petroleum Company.

Not only are supply tanks brimming, but consumption of home heating oil is down and is expected to remain low through the winter compared to last year. DOE projects that residential use of home heating oil in the US will average 220 ,000 barrels per day less in the October to December quarter this year compared to that period in 1979.

The expected decline in consumption is attributed to greater household energy conservation and more homeowners switching from heating oil to natural gas or electric heat, which are perceived by a growing number of consumers to be more reliable.

The American Gas Association (AGA) claims some 300,000 residences in the United States have converted from home heating oil to natural gas in the past year. This is expected to boost the residential demand for the trade association said the natural gas industry "will have plenty of supply to take care of it."

Overall, total US natural gas consumption is not expected to rise this year because of federal regulations that are discouraging use of gas by utilities and industry. A surplus of natural gas in the industrial market is expexted to provide the needed increase in supplies for homes consumption.

Residential customers in New England, who pay the highest natural gas prices in the country, can expect their rates to be about 10 percent higher this winter than last, according to the AGA. Decontrol of natural gas prices is a major factor in the higher cost of the fuel.

Home heating oil prices have actually leveled off since March of this year, after jumping sharply during last winter. The average US retail price increased from 81 cents a gallon in March. In recent months the price has remained stable.

The price outlook for home heating oil this winter varies, depending on what kind of weather forecast is plugged into the equation. Still, most estimates do not call for price increases comparable to those of last winter.

DOE projects that home heating oil will be about 25 percent more expensive in December than at the beginning of the year. By contrast, in 1979 home heating oil jumped $S percent in price from January to December.

of 5 stories this month > Get unlimited stories
You've read 5 of 5 free stories

Only $1 for your first month.

Get unlimited Monitor journalism.