As Fall becomes Winter, many are fearful that millions of families are about to experience a hike in heating bills. Many analysts are concluding that the months ahead will be very tough on the pocket book of many Americans due to inflation and the skyrocketing price of heating oil, natural gas, and more.
With the coronavirus pandemic still surging and the economy on an unstable ground, the idea of a cold winter with expensive bills sounds like a nightmare to many. What is causing the speculation that prices are about to rise? What is the root cause of this change?
Predictions for this Winter
Many business and industry analysts have predicted a harsh winter when it comes to the energy bill for many families.
Natural Gas
For example, natural gas-powered homes – which account for roughly half of all U.S. families – may spend $746 this winter, up 30% from a year earlier. This might result in their heating expenditures being the highest since the winter of 2008-2009.
Electricity
Meanwhile, households who use electricity, which account for around 41% of the country’s population, might see a relatively moderate 6% hike to $1,268. Heating oil users, who account for 4% of the country’s population, may see their costs rise by 43%, or more than $500, to $1,734.
Propane
Additionally, the most significant increases are predicted for homes that use propane. That accounts for only 5% of all families in the United States, but other households are also likely to suffer significant increases.
For most Americans, it will be a significant increase across the board. All in all, with global prices for heating oil, natural gas, and other fuels increasing, the US government has predicted that homeowners’ heating expenditures would rise by up to 54 percent this winter compared to last.
Inflation Strikes Again
All of this negative news serves as a harsh reminder of the global economy’s inflationary spiral. According to a different study provided by the US government, consumer prices in September were 5.4 percent higher than a year earlier. As a resurgent economy and clogged supply chains drive up costs for everything from autos to groceries, this is the highest inflation since 2008.
Employers, on the other hand, are not doing enough to keep up with the rate of inflation. Most workers’ pay hikes haven’t kept up with inflation so far. Workers’ average hourly earnings increased by 4.6 percent last month compared to a year ago. While that is good news it is becoming apparent that more needs to be done.
Conclusion
The coming winter will prove challenging for many reasons. The economy is rebounding, but slowly, while the job market remains in flux and many businesses face shortages. Inflation is only making things worse. Combined, this will lead to higher-than-normal electricity bills and yet another headache for many Americans.