Northeast sinks into ‘Whac-A-Mole’ winter energy crisis

AAfter enduring months of record gas price and pain at the pump, people and their wallets are ready for a break. But nowhere is relief further from sight than in New Englandwhere energy prices are rising rapidly, emergency stocks are depleted, and the region’s overreliance on distillate fuel has propelled it into a winter slump.

According to the Energy Information Administration, residents who depend on home heating oil will spend an average of $2,354 to heat their homes this winter, a 27% increase from the previous winter and the highest price in more than 25 year. The North East relies heavily on fuel oil, which is the main source of heating for 18% of households.


Those who use natural gas for heating will also spend a staggering average of $1,094, or 28% more than last winter.

Add to that rapidly dwindling stocks of US distillate fuel and the Northeast appears to be snowballing rapidly into a major energy crisis, with little or no short-term relief in sight.

The US ban on Russian gas imports was a major contributing factor: Before the war in Ukraine, the US imported around 700,000 barrels of oil from Russia every day, according to government data. Of these imports, most were shipped directly as refined petroleum products, allowing the Northeast to use its own refineries to produce gasoline instead.

Switching from gasoline production to distillate fuel production would be difficult because U.S. refineries can’t just “turn on a penny to stop producing gasoline and start producing distillate fuel,” said Mark Wolfe, executive director of the National Energy Assistance Directors Association.

Additionally, New England has been dubbed an “energy island” due to its shortage of pipelines, which leaves it largely disconnected from the rest of North America and limits its ability to import alternative supplies as a short-term solution. term. By 2021, more than a fifth of the East Coast’s distillate supply was imported from international sellers.

Europe has also agreed to send some diesel imports as a temporary reprieve, although the impact is limited.

Signs of crisis are mounting in New England — and fast. “It’s like a giant game of Whac-A-Mole, heading into winter,” Wolfe said. “Supply is low. Europe has increased its purchases abroad to replace sales of Russian distillates, which is causing tensions in the market,” he said.

And with fuel storage falling to its lowest level since 1951, containing just enough emergency supplies to last 26 days, analysts say this is likely just the start of a long and painful winter.

In the meantime, consumers and retailers are doing what they can to get by.

Some wholesalers have started allocating limited amounts of heating fuel to retailers in their home countries, who in turn have to ration the amount they can sell to consumers.

And buyers settle for less.

Some are only filling their tanks to partial capacity this winter, while others have opted to stop eating out or buying fewer groceries, one of many painful trade-offs needed to endure the exorbitant costs.

For Abdulmuqsad Waziri, an Afghan evacuee who helped US troops during the war, finding ways to pay high energy bills in his new home state of Massachusetts has been a particularly difficult challenge. His family moved back to the state late last year and he has since found steady work at a restaurant he enjoys.

But despite his hard work, diligent budgeting and pressing demands for as many extra shifts as the restaurant will allow him to take on, the price of his first winter heating bill, in October, took him by surprise. .

“The last bill I got was for $500,” he said. “I was unable to pay that bill.” Thanks to an international aid group, he got the help he needed.

But concerns are high for the months to come – not just for Waziri, but for the thousands of others who say they are paying hundreds more a month to heat their homes than they were in previous years – threatening a very real accessibility crisis for many.

And since analysts don’t expect distillate markets to return to normal until next summer at the earliest, the United States is in uncharted territory, at least for the foreseeable future.

“It’s really the first time a fuel has jumped so high before” and so directly impacted the lives of consumers, Wolfe said.


“We are worried about families who could pay the bill last year, the year before, but who will not be able to pay it this year. And we will have more people coming to ask for help,” he said.

“Between the supply issues, the price issues, it’s pretty serious.”

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