Americans have known for months that the coming winter would be difficult.
Household budgeters have been able to focus their response to rising crude prices on just filling up their vehicles, but now that it’s officially fall, the weather is turning, the leaves are changing color, and the focus will now start to shift to the cost of heating the home.
But vehicle gas tanks will also still need to be filled, so Americans will experience some extra pressure, thanks to the fallout from the war with Iran.
On the positive side, 2026 is an El Niño year, and typically El Niño winters feature warmer temperatures in the northern region of the country, Time noted. Meanwhile, the southern and western parts of the country usually experience wetter, stormier conditions.
Despite that small reprieve, this year Americans should expect a significant increase in their winter energy bills, one that’s even steeper than previous estimates.
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Heating oil costs surge
The National Energy Assistance Directors Association (NEADA) now expects heating oil costs to increase by 50% year over year, up from its previous estimate of 31.3% just a few weeks ago.
NEADA identifies the ongoing wars in Iran and Ukraine that have disrupted petroleum markets as the culprit for higher prices.
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“Heating oil is a product very similar to diesel gasoline. Both are distillate fuels made from the same part of the refining process, so when the price of diesel goes up, the price of heating oil generally follows,” NEADA said in a recent report.
“The disruptions in the Middle East have hit diesel and other distillate fuels like heating oil especially hard. Supplies were already tight, and refinery disruptions have put even more pressure on prices.”
Higher prices will hit different regions differently
While the average cost of heating a home with oil is expected to increase by about $878 from $1,749 last winter to $2,627 this year, certain regions will be hit harder than others.
Despite the milder El Niño winter in the Northeast, where about 82% of the nation’s heating oil is used, New England residents are expected to spend about $1,000 more than they did last winter.
“For example, the price of a gallon of home heating oil in Massachusetts reached $6.15 this week, up 74.7% from $3.52 a year ago this time. New York State is reporting similar numbers at $6.27 per gallon, up from $3.69 last year. A standard residential fuel oil tank holds 275 gallons. In other words, a tank of heating oil in New York will increase from $880 to $1,568, well out of reach for many families,” NEADA said.
New England has more than 2 million homes using heating oil, and they’ll average paying $2,849 to heat their homes this winter. Meanwhile, the 2.3 million households in the Mid-Atlantic (which NEADA counts as Delaware, New Jersey, New York, and Pennsylvania) should expect to spend about $779 more year over year for an average of $2,429.
Energy prices could become an emergency for lower-income families
NEADA acknowledges that El Niño will play a factor in lowering demand this winter, but the increase in prices will overtake any savings for the milder cold season.
Lower-income families are particularly vulnerable.
“Winter is just around the bend, and we are very concerned about what this means for low-income families that use heating oil,” said NEADA Executive Director Mark Wolfe.
“A 50 percent increase in heating costs is simply too much for a family living paycheck to paycheck to absorb. Families are already paying more for electricity, food, and rent. Now they are looking at another big increase just to keep their homes warm. These numbers are alarming!”
For older Americans on Social Security, the 3.6% increase in benefits slated for January won’t come close to covering these added costs.
“For low-income families, an additional $779 in the Mid-Atlantic states to about $1,000 in the New England states for heating costs is not a small increase. It can mean falling behind on another bill, cutting back on food or medicine, or turning the thermostat down to unsafe levels,” Wolfe said.
“Winter is almost here, and families have very little time to prepare. We are looking at a 50 percent increase in heating costs for families that depend on heating oil while electric bills are rising rapidly across the country.”
NEADA says it has asked Congress for $3 billion in supplemental funding for the Low Income Home Energy Assistance Program.
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