When Are Home Heating Prices Expected to Go Down?

With winter weather intensifying, homeowners in the U.S. are experiencing the problem of home heating costs. Recent years have seen a notable jump in energy prices, leaving many searching for answers and relief. Understand what impacts home heating prices, the recent trends we’ve seen and ways to keep your utility bills in check.

Different Kinds of Home Heating Fuel

A number of fuels are used to keep homes warm and cozy in the United States:

  • Natural gas heats 48% of American homes.
  • Heating oil heats 5% of homes.
  • Propane accounts for another 5%.
  • Electricity warms 40% of U.S. homes. Fossil fuels are still the most used source for generating electricity in spite of the increase in renewable energy sources like wind and solar. 

What Affects the Price of Fossil Fuels?

According to the above information, it’s evident that fossil fuels heat a vast majority of North American households. Supply and demand is the biggest factor generating price fluctuations. An increase in supply—triggered by greater production and storage rates—usually lowers prices, while a surge in demand—triggered by harsh weather, a booming economy and rising rates for alternative fuels—can cause prices to climb.

How Much Have Natural Gas Prices Increased?

Domestic natural gas production outpaced consumption starting in 2017, causing a general price decline in all of 2018. But, demand has soared recently across all sectors, causing natural gas prices to hit heights not seen in roughly a decade.

In 2022, the average wholesale cost of U.S. natural gas surged to its highest price since 2008, reaching an average of $6.45 per million British thermal units (MMBtu). This massive increase represented a major leap of over 53% from the previous year, marking it as one of the biggest annual increases in history.

Numerous factors contributed to the unpredictable rise and lack of stability of natural gas prices last year. In early 2022, processing hiccups caused by freeze-offs and a substantial draw from natural gas reserves nudged prices way up. Robust liquefied natural gas (LNG) exports to Europe and other regions, coupled with a surge in domestic demand caused by cold weather, stretched the price range even further.

In the spring of 2022, prices jumped past $9/MMBtu, only to drop by 40% following the fire and subsequent shutdown at the Freeport LNG export terminal. This incident considerably cut U.S. LNG exports and redirected more natural gas to storage. But, as the summer heat faded, prices climbed again, reaching a peak in late August.

Shifting into the fall, an uptick in natural gas production and higher-than-average injections into storage saw prices drop down closer to the five-year average. But, as temperatures decreased, the demand for heating caused prices to go up once more.

When Will Prices Go Down?

The fluctuations in natural gas prices are indicative of the complex interplay of factors influencing home heating costs. As we look ahead to the rest of the 2023-24 heating season, the market’s past behavior offers insights into future price trends and the prospect of cost-saving options.

As of late 2023, prices have come down from their previous highs because of robust production and reasonably moderate temperatures. Even though demand is still steady, forecasters are predicting prices around $3.44/MMBtu this winter, providing some respite for homeowners as we move through the heating season.

Tips to Trim Your Heating Bill

No matter how you heat your home or what prices are like, you can take several easy steps to improve energy efficiency and reduce your heating costs. Here are a couple of suggestions:

  • Seal drafty windows and doors with caulk and weatherstripping.
  • Use curtains to your advantage, making sure to pull them open during the day for free light and heat and then pulling them back over the windows at night to insulate your windows.
  • Boost attic insulation to stop heat from rising out of your home.
  • Buy a smart thermostat that learns your habits and helps you save money.
  • Reduce the temperature on your thermostat when you’re away so you aren’t spending money to heat an empty house.
  • Put on warmer clothes inside your residence so you do not have to crank up the thermostat.
  • Schedule yearly furnace maintenance to keep your heating system in good working order.
  • Install a whole-house humidifier. Moist air feels warmer than dry air, so you feel more comfortable at a lower temperature.

Bring Comfort Home in the U.S. with Service Experts Heating, Air Conditioning & Plumbing

Nothing is more critical to the Service Experts Heating, Air Conditioning & Plumbing team than your comfort and safety. Our heating solutions can also help reduce home heating costs, which is excellent news for your pocketbook. With ACE-certified technicians at the helm, you can expect quick, durable remedies to all your comfort needs. Our 100% satisfaction guarantee means that if you’re not completely happy with our services, you can count on us to make things right.

As a company that prides itself on innovation, customer engagement and community involvement, you can trust Service Experts Heating, Air Conditioning & Plumbing to make a significant difference in your life and enjoyment of your residence. For more details of what you can expect with heating prices in the U.S. or personalized tips to help reduce your utility bills, reach out to the professionals at Service Experts Heating, Air Conditioning & Plumbing. Call 866-397-3787 today to learn more.

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