Consumers
Face Problems With Higher Home Heating Oil Prices This
Winter
All Headline News ^ | July 18, 2008 | Linda Young
Washington, D.C. (AHN) - Consumers who use heating
oil to warm their homes will face higher prices this winter. Although some
people are working on ways to deal with the problem, it threatens to
impoverish even middle-class American families.
About 8.1 of the 107 million households in the
Heating oil prices used to be cheap, but now are
around $5 per gallon and expected to go higher. That means that households
could face home heating costs of thousands of dollars for the cold season in
some of the Northeast that would be unaffordable for many families this winter.
Since residential space heating is the primary use
for heating oil, and since demand is, therefore, highly seasonal, there are big
price hikes for heating oil from October through March during the nation's cold
season.
The EIA notes that most residential heating oil
consumers don't have the capacity to store all the heating oil they will use
during the cold months, which means they often must order heating oil four or
five times during the season. But EIA officials say one thing consumers can
do is make sure they fill their tanks during the summer when heating oil prices
are low to take advantage of those cost savings for part of their fuel.
Other things that consumers can do is switch to
furnaces that use lower priced heating sources, such as electric furnaces, heat
pumps, geothermal systems or furnaces that burn pellets made of wood waste
products.
The country does have a federal program to help
people. But unless the U.S. Congress
boosts funding to the Low Income Home Energy Assistance Program, it will likely
help fewer people this year than last as heating oil prices continue to rise. The
average grant was $359 per year and the program helps only about 17 percent of
the nation's poor.
But home heating oil prices are only one of a
package of higher energy costs families must cope with.
The National Energy Assistance Directors'
Association represents state officials who administer energy relief funds. Its
executive director, Mark Wolfe, says it isn't just home heating costs that are crimping
budgets for families in New England, but that those costs would add to the
rising tab of energy costs meaning that some families there, who are already
having trouble making ends meet, could face costs of around $1,600 to $1,700
a month next winter to cover heating oil, electricity and gasoline costs.
"I don't see any way to make the numbers
work for middle-income people," Wolfe
told The Wall Street Journal.
"They're already shopping at Wal-Mart and
eating out less. They'll have to cut back everything that makes them middle
class. At some point, you're poor,"
he said.