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EIA forecasts slightly higher US propane consumption this winter

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Hydrocarbon Engineering,


The US propane market is highly seasonal: about two-thirds of the propane consumed last year was consumed in the winter months (October through March).

In the US, most propane is consumed in homes during the winter; about 5% of US homes use propane as their main heating fuel. In its latest Short-Term Energy Outlook (STEO), the US Energy Information Administration (EIA) expects 5% more US propane consumption this winter compared with last winter, largely because a cooler winter forecast means more demand for residential space heating.

EIA’s October STEO includes a supplement for consumption, price, and expenditures of residential heating fuels in the US. EIA expects residential propane expenditures this winter for propane-heated homes to be 18% higher in the Northeast and 12% higher in the Midwest, the two regions where propane heating is most prevalent.

EIA forecasts higher propane expenditures in these regions because it expects higher propane prices and colder weather, which will require more fuel for space heating. EIA also assumes that more people will be working or attending school from home this winter, which will also increase demand for residential heating fuels compared with last winter.

EIA expects the increased heating demand will more than offset reduced demand for propane as a petrochemical feedstock by US industry. Propane is also used as a fuel for drying agricultural crops, and EIA expects less grain drying demand than last year. According to US Department of Agriculture data and forecasts, corn crop maturity in the US is on track with the previous five-year average, and harvested grain moisture content will be lower than last year, which means less use of propane for drying crops in commercial grain dryers.

Read the article online at: https://www.hydrocarbonengineering.com/special-reports/22102020/eia-forecasts-slightly-higher-us-propane-consumption-this-winter/

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