Cheapest way to heat your home? Four fuels compared.

Not all home heating fuels are created equal. Here's what it would cost to heat the average home in the Northeast with oil, natural gas, electricity, and propane, as forecast by the Energy Information Administration (EIA):

1. Natural gas: $1,024

Keith Srakocic/AP/File
In this 2011 file photo, Range Resources site manager Don Robinson stands near the head by the drill that goes into the shale at a natural gas well site in Washington, Pa. The boom in natural gas drilling has caused prices to fall and made natural gas the cheapest of the four major home-heating fuels.

Of the four main fuels used to heat US homes, natural gas is the most popular and now the cheapest, as well. A decade ago, gas cost about 80 percent of an equivalent amount of oil; it now costs less than half of oil, as oil prices have risen and America’s boom in natural gas drilling has kept gas prices low. Nearly half of all homes use natural gas as their primary heating source. Some analysts forecast a huge supply of the fuel will be available for decades to come. 

Not everyone believes the supply is so large that natural gas will continue to be a low-cost fuel. The trends of the past decade, however, are encouraging: In inflation-adjusted terms, natural gas prices are roughly the same as they were in 2003-04, even before adjusting for inflation.

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