U.S. Winter Heating Costs Forecast to Diverge by Fuel Type
U.S. households face sharply different heating bills this winter, with natural gas and propane users saving while heating oil and electricity costs rise, driven by opposing fuel price trends and regional temperature forecasts.
Overall energy expenditures this winter will vary widely by heating fuel and region due to opposing price trends and temperature forecasts. The U.S. Energy Information Administration's Winter Fuels Outlook projects diverging trends in energy prices among fuels and significant regional variation in forecast temperatures, leading to a split market for consumers. Homes using heating oil could see a 21% increase in spending compared to last winter.
Natural gas and propane users set to save
Households heating with natural gas or propane are expected to see lower energy expenses due to lower fuel prices, benefiting roughly half of U.S. homes. Energy expenditures are expected to decrease on average by 9% in homes heating with natural gas. For propane users, a 3% average decrease is forecast. These households account for roughly half of all U.S. homes.
Heating oil users face sharp cost increases
The small share of homes using heating oil, concentrated in the Northeast, could see a 21% spending increase driven by higher prices and tight regional inventories. About 3% of U.S. homes use heating oil as their main heating fuel. The price of heating oil is forecast to average 34% more this winter than last winter, though warmer forecast temperatures are expected to partly offset the price increase. Distillate fuel inventories along the U.S. East Coast remain well below normal seasonal levels, contributing to higher heating oil prices. Global distillate fuel production has dropped due to reduced global refining activity, raising international prices and increasing the cost of U.S. imports. Through the first seven months of 2026, U.S. distillate exports increased 20% over the same period last year, with much of the increased volume sent to Europe. With more costly imports and higher export demand, U.S. distillate fuel stocks are low heading into winter, with inventories expected to be about 11% below the five-year average in the fourth quarter of 2026.
Electricity users see modest bill increases
More than 40% of electric-heating households are expected to experience a 4% average increase in electricity bills, partially offset by warmer temperatures in some regions. Higher prices for electricity are expected to drive increased expenditures for households heating with that fuel.
Regional temperature patterns drive fuel demand differences
National winter temperatures are expected to be similar to last winter and close to the long-term seasonal average. The forecast assumes warmer temperatures in the Northeast following a relatively cold winter last year. It also assumes much colder temperatures in the West following an unusually warm winter last year. Temperatures in the Midwest and South are expected to be similar to last year. Households using natural gas or propane for heating are expected to see lower energy expenses compared to last winter.
