Heating oil prices set to skyrocket this winter
Families relying on heating oil are bracing for a steep increase in winter energy bills, with costs projected to rise nearly 50% compared to last year. The National Energy Assistance Directors Association (NEADA) estimates that heating oil expenditures could climb by about $878, pushing the average bill to over $2,600 this winter. This figure is significantly higher than the Energy Information Administration's (EIA) projection of a 21% increase, though both reports agree that electricity bills will rise by 4% nationally, while natural gas and propane costs are expected to decrease.
The Northeastern United States will be hit hardest, as 82% of home heating oil is consumed in the region, where natural gas pipelines are less developed. Only 3% of U.S. households use oil as their primary heating source, with the majority relying on natural gas (45%) or electricity (43%). The surge in heating oil prices is attributed to global oil market instability due to conflicts in Iran and Ukraine, as well as declining refinery activity. Mark Wolfe, executive director of NEADA, described these trends as the 'worst-case scenario' of the ongoing wars, warning that vulnerable families may cut back on essentials like food or medicine to afford heating.
Some states are taking action to mitigate the crisis. Massachusetts Gov. Maura Healey declared a State of Energy Emergency, unlocking nearly $150 million in relief for middle-class households that heat with oil. Similarly, Rhode Island has allocated $28 million for electric-bill relief, and Maine has announced $40 million in automatic electricity discounts for low-income residents. However, states have limited tools to protect heating-oil customers compared to those served by regulated gas and electric utilities, as affordability programs and winter shutoff protections typically do not apply to independent heating-oil dealers.
The energy affordability crisis is further complicated by the Trump administration's efforts to dismantle the Low Income Home Energy Assistance Program (LIHEAP). Despite the administration's proposal to eliminate funding and the firing of LIHEAP's federal staff in April 2025, the program continues to operate, with the Department of Health and Human Services (HHS) assuring that funds will be distributed as allocated by Congress.