As winter nears, Long Island natural gas prices are flat, while fuel oil's are soaring

Typical natural gas customers on Long Island can expect only a marginal increase in their winter heating bills this year, but hundreds of thousands of fuel oil users are in for sticker shock, experts said Monday.

Last month, National Grid, the region’s primary natural gas supplier, released a projection that its Long Island customers could see a seasonal decline of $120 in the supply/commodity portion of their bills through the November to March heating season. The catch: the delivery portion of bills is projected to rise about $125 during the same period. In all, average customers who use around 720 therms during the winter can expect a net seasonal increase of $5, National Grid said.

Heating oil customers won’t be so lucky. The average price of a gallon of heating oil across Long Island last week increased from already staggering highs of more than $6 a gallon, settling in at $6.37. That’s an increase of 67% from a year ago, when customers paid $3.82 a gallon, according to a state database.

For the nearly 400,000 Long Island customers who heat their homes with oil, the impact will begin to be felt this month with dropping temperatures.

Industry experts say the price of home heating oil, like its diesel fuel cousin, is tied directly to the global cost of oil, which hit highs last week of more than $110 a barrel. The soaring cost is directly the result of the Trump administration’s war with Iran, but winter supply constraints could also play a role.

National Grid customers saw the commodity portion of their bills decline through the summer and fall, from a high of 70.76 cents a therm in June to 44 cents in October. Average customers use around 720 therms a month.

National Grid’s projection of a total $5 increase this winter, based on “current market conditions,” was that customers who use that average therm number would see total winter bills of around $1,461 for the November through March season.

For heating oil customers, filling a 250-gallon tank just once (from empty) would cost $1,592.50.

“People are going to be shocked,” said Michael White, vice chairman of the Long Island Regional Planning Council, a strategic planning group for Nassau and Suffolk. “It’s going to be a real problem this winter. In the next month there are going to be thousands of people who cannot afford to fill their tank again.”

"Those costs are definitely rising," said Barbara C. Guinn, commissioner of the state Office of Temporary and Disability Assistance, in an interview on Monday. She also noted a state-administered program known as Home Heating Energy Assistance will begin taking first-come, first-served applications starting Nov. 2. She said the federally funded benefit for those who heat with fuel oil, propane and kerosene has been increased this year to a minimum of $990 from $900 last year. 

"The benefits are substantial," Guinn said, adding the agency expects around 71,000 Long Islanders to receive the benefit, as they did last year, totaling some $22 million in aid. An emergency version of that program can be accessed in January, Guinn said. 

Ian Donaldson, a spokesman for the Public Utility Law Project, a consumer watchdog group, encouraged customers worried about heating costs to contact their local Department of Social Services "as soon as HEAP opens to determine what assistance may be available."

Rocco J. Lacertosa, chief executive of the New York State Energy Coalition, which represents heating oil companies, said member companies are already offering cap programs and bill-budgeting programs to help defray what could be high winter oil bills.

“I feel bad for consumers who have to bear this burden right now,” he said. “It’s tough…There will be people who have problems paying their bills.”

Lacertosa said it’s not just the war with Iran that’s driving up prices. “The war is part of the problem, but there’s a lot of speculators who are trading” and increasing price volatility.

Worse, he said, the end of the war, if it’s near, won’t immediately mean relief. “Even if the war ends tomorrow I do not see prices falling back that quickly,” he said. “It will take time for prices settle out.”

One Long Island heating oil customer who hedged his bets last year saw the benefits this month, but is bracing for the worst in December. Jim Taylor, of East Northport, locked in a one-year rate of just over $3 a gallon last November. A fuel truck that arrived earlier this month honored the price and he filled up.

“I wish I had another tank to fill,” he said.

But as that fill-up runs out in December, Taylor said he’s going to have to make choices. Should he lock in at a high winter rate in the $6 range next month, or hope prices come down early next year?

“I’m getting close to the day where I have to make a decision,” Taylor said. “One of my friends locked in at $5.65 a gallon. I don’t know. I had another place quote me $6.30 a gallon. I prefer having a contract. I have no idea where it’s going to go.”

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.