New York and New England start RATIONING heating oil before winter as stockpiles slump by 70%...
and fears rise that families will be left in the cold
Heating oil stockpiles in New England are a currently third of normal levels
Wholesalers have begun rationing to prevent panic buying and hoarding
Heating oil, which is similar to diesel, is used widely in New England
Energy Department says heating oil prices will be 27% higher this winter
Heating oil suppliers in the Northeast and New England have begun rationing the key fuel ahead of winter, after stockpiles dropped to a third of their normal levels.
Concerns are rising that supply shortages and soaring prices will leave families in the cold this winter, particularly in New England, which is more reliant on heating oil than other parts of the country.
The rationing measures, intended to prevent panic buying and hoarding, are in turn being imposed on consumers, limiting the amount of heating oil they can purchase, said Herb.
Heating oil, which is chemically similar to diesel, is primarily used in New York, Pennsylvania and New England, where most distribution is handled by small, family-owned businesses.
This year, New England's inventories of stockpiled heating oil are about 70 percent lower than their average level since 1993, government data show.
Supplies are lower this year due to the same factors impacting world oil markets, including the failure to rebuild production capacity following the pandemic, and disruptions from Russia's invasion of Ukraine.
According to Bloomberg, heating oil stockpiles have also been affected by a pricing structure known as 'backwardation', in which prompt deliveries are priced at a premium over deliveries in the future.
'There's just no incentive to store large amount of product,' Michael Ferrante, president of the Massachusetts Energy Marketers Association, told the outlet.
Heating oil prices have also been rising rapidly, topping $4.09 a gallon in New York last week, up from $2.46 one year ago.
The Energy Department estimates that families who rely on heating oil will see their heating costs soar 27 percent this winter.
It's projected to cost more than $2,300 to heat a typical home with heating oil this winter, the department said.
About 90 percent of the US relies on natural gas or electricity for heating, and those households can also expect to see their heating bills rise.
The Energy Department projects heating bills will jump 28 percent this winter for those who rely on natural gas, while electricity will rise about 10 percent.
The average total cost to heat a home this winter is expected to be $931 with natural gas, and $1,359 with electricity.
Across the country, some are urging utilities to implement a moratorium on winter shut-offs, and members of Congress already added $1 billion in heating aid.
But there will be fewer federal dollars than last year when pandemic aid flowed freely.
In Maine, the state has the nation's oldest population and it's the most reliant on heating oil, creating a double whammy.
'People are scared. They're worried. They're frustrated,' said Lisa McGee, who coordinates the heating aid program for Community Concepts Inc. in Lewiston, Maine. 'There´s more anxiety this year.'
Maine resident Aaron Raymo saw the writing on the wall and began stocking up on heating oil in five-gallon increments over the summer as costs crept upward.
He filled a container with heating oil as he could afford it, usually on paydays, and used a heating assistance program to top off his 275-gallon oil tank with the arrival of colder weather.
His family is trying to avoid being forced into a difficult decision - choosing between food or heating their home.
'It's a hard one,' he said. 'What are you going to choose for food, or what amount of fuel oil are you going to choose to stay warm?'
The situation is even bleaker in Europe, with Russia's continued curtailment of natural gas pushing prices upward and causing painful shortages.