The average U.S. residential price of propane reached $2.59 per gallon (gal) as of October 4, 2021, the highest price reported for the first week of the winter heating season since 2011, according to our Heating Oil and Propane Update (HOPU). The winter heating season runs from October through March. Prices during the first four weeks of the current winter heating season were 49% higher than the same time last winter.
This year, retail propane prices have risen with wholesale propane spot prices that reflect greater global demand and tight global supply. That tightness is reflected in inventory levels in the United States. U.S. propane and propylene inventories are starting this winter season lower than in recent years; weekly U.S. inventories are averaging 28% lower than the same time last year and 21% lower than their recent five-year (2015–2020) average.
According to the U.S. Census Bureau’s 2019 American Community Survey, propane is the primary home heating fuel in 5% of U.S. homes and tends to be more common in the Northeast and Midwest. At least 14% of homes in Vermont, New Hampshire, South Dakota, North Dakota, and Montana use propane as the primary heating fuel.
In our latest Winter Fuels Outlook, we expect households that use propane as their primary source of heating fuel will spend 54% more on average for heating this winter compared with last winter, mainly as a result of higher propane prices. Propane prices are generally highest in New England and lowest in the Midwest. Of the states surveyed in HOPU, during the week of October 25, residential propane prices ranged from a low of $2.01/gal in North Dakota to as high as $4.93/gal in Florida.
The HOPU is published as part of the State Heating Oil and Propane Program (SHOPP), a joint effort between EIA and several state energy offices to collect state-level residential heating oil and propane price data from October through March in states where heating oil and propane use is common. SHOPP collects residential heating oil and propane prices for 21 states. In 18 additional states, SHOPP collects only propane prices, and in the District of Columbia, SHOPP collects only heating oil prices.
The HOPU also publishes wholesale heating oil prices for 25 states and propane prices for 23 states. We publish price data in the HOPU each Wednesday at 1:00 p.m. eastern time from the first week of October through the last week of March on the Winter Heating Fuels and Heating Oil and Propane Update web pages.
Principal contributors: Marcela Bradbury, Sean Hill