New England Gets Windfall From Plummeting Heating Oil Prices
PORTLAND, Maine (AP) — The region that relies most heavily on heating oil to stay warm is getting a windfall from the big drop in prices, which have plummeted to the lowest level in six years.
Across New England, lower prices mean hundreds of millions of dollars in savings, putting more money in people's pockets and giving the region an economic boost. Families using oil to heat their homes can expect savings of $1,200 to $1,500 on average this year from lower heating oil and gasoline prices, officials said.
"The last time oil prices were this low, the economy was collapsing. Now the economy is expanding. So the drop in oil prices adds income to an expanding economy," said Charles Colgan, director of the Maine Center for Business and Economic Research.
Heating oil tracks closely with the price of crude oil, which has dropped from a high of $115 a barrel in June to today's level below $50, said Michael Leahy from the U.S. Energy Information Agency.
Nationally, heating oil is down by at least a dollar a gallon. The average price in Maine last week was $2.63 per gallon, compared with $3.81 a year ago, according to a state survey.
The impact is being felt across the country but especially in New England where the number of homes using heating oil ranges from 32 percent in Massachusetts to nearly 70 percent at the nation's northeastern tip in Maine. Nearly 50 percent of homes in New Hampshire and Vermont heat with oil.
Patrick Woodcock, Maine's energy chief, said the greatest impact is on people who struggle the most.
"It really is a targeted infusion of money into people's wallets who most need it — our low-income folks who disproportionately spend income on energy bills," he said.
Local community action agencies that distribute federal heating aid say recipients like Heidi Halpin in Down East Maine are stretching their oil dollars further thanks to lower prices.
Current prices mean Halpin is receiving an extra 30 gallons of oil — enough for to heat her home for two weeks.
"It may not seem like a lot to most people, but it means a lot to someone who doesn't have it," said Halpin, who's disabled and shares a home with her 67-year-old mother. "Thank goodness we've been able to stay warm."
Such a collapse in heating fuel prices is rare, having happened only three times in the last 40 years, Colgan said. In Maine alone, it'll mean an economic boost of about $300 million, he said.
If the low energy prices continue, the entire region could see an even bigger boost to its summer tourism industry, with people driving farther and staying longer, he said.
For now, customers — and heating oil companies — are happy with lower prices.
Companies like Giroux Energy Solutions are saving on diesel fuel for trucks and spending less time trying to collect from customers, owner Steve Giroux.
"Typically, when prices are higher you hear bickering and complaining, 'I can't afford it' and 'I don't know what I'm going to do,'" he said. "When prices are low like this everybody's happy."
Retailers also are seeing an economic impact this winter. Some ski areas report bigger sales of season tickets. And people are dusting off their snowmobiles or looking to buy new ones.
Wayne Kenniston, who has a snowmobile shop outside Portland, said he's sold out.
"This is one of the busiest years I've had in a long time. I'm sure it's due to the economy," he said. "With fuel being down, that has had a major impact. People have a little money in their pockets."
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