More: Read the Energy Information Administration’s full report.
Americans can expect cheaper heating bills this winter compared to last, the federal government forecast on Tuesday, as long as they heat mainly with natural gas, electricity or propane.
But according to the U.S. Energy Information Administration’s Winter Fuels Outlook, households who use heating oil could spend slightly more.
The agency predicts continued upward pressure on crude oil prices and is initiating a new OPEC+ oil production forecast as part of its analysis. The group of oil exporting nations have voluntarily cut production, and the EIA expects them to decrease crude production by 300,000 barrels per day in 2024 compared to this year. This will keep global production below demand, the agency said.
“As a result, we expect upward pressure on crude oil prices, with the Brent spot price increasing to average $95 per barrel (b) in 2024,” the EIA’s October forecast said. It expects jet fuel consumption to rise, reflecting strong consumer demand for air travel, “which has returned to pre-pandemic levels.”
But the forecast says natural gas inventories by the end of this month will most likely be 3,854 billion cubic feet, 6% more than the five-year average at the end of October, deflating prices.
“We forecast that electricity generation from natural gas will account for about 42% of U.S. generation in 2023, an increase from 39% in 2022. This increase is the result of relatively low prices for natural gas; the retirement of 10 gigawatts of coal-fired generating capacity this year; and 5 GW of new, highly efficient natural gas-turbine capacity entering service.”
The forecast expects natural gas-fired electricity generation to fall slightly to a 41% share in 2024. “Despite a forecast increase in overall electricity generation in 2024, we expect generation from both natural gas and coal will fall next year in part because of increasing generating capacity from renewable sources,” the report said.
That includes 40 gigawatts of solar and wind generating capacity predicted to join the grid next year, a 16% increase from 2023, “leading to the share of electricity provided by renewables rising from 22% in 2023 to 25% in 2024.”
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