Americans could pay far more to heat their homes with oil this winter than last, a new analysis reviewed by Axios shows, as volatile energy markets and the Iran War deepen the affordability crisis.
Why it matters: Heating bills are eating into household budgets before winter sets in, with stark divides between fuel types.
By the numbers: Families that heat with oil could pay about 50% more this winter than last, according to estimates from the National Energy Assistance Directors Association (NEADA), up from its 31.3% projection in mid-September.
- The average cost of heating a home with oil is expected to rise by about $878, costing over $2,600 this winter.
- By comparison, the Energy Information Administration's Winter Fuels Outlook released Tuesday projects electricity bills will rise 4% nationally, while natural gas bills will fall 9% and propane spending will drop 3%. EIA expects a smaller increase on heating oil than NEADA, projecting a 21% increase in household expenditures.
Northeastern households will feel the pain most acutely: about 82% of home heating oil is consumed in the region, where some states lack robust natural gas pipelines, according to NEADA data.
- Just 3% of U.S. households use oil as their primary heat source, compared to about 45% using natural gas and 43% using electricity, NEADA says.
The big picture: Heating oil prices are rising as global oil markets falter because of the wars in Iran and Ukraine and as refinery activity declines.
- "Those trends really reflect the worst-case scenario of this war, and they are going to feel it this winter, and it's unfortunate," Mark Wolfe, executive director of the NEADA, tells Axios.
What they're saying: Because of the cost, some families will cut back on food or medicine, borrow from payday lenders, or turn the heat down to unsafe levels to cover their heating bills, Wolfe says.
- "With low-income families, sometimes states will move money around to help them, but they'll go without," Wolfe says.
Between the lines: States can put more money toward heating assistance, but they have fewer tools to protect heating-oil customers than households served by regulated gas and electric utilities, Wolfe says.
- States can require utilities to offer discounts, affordability programs or winter shutoff protections, but they generally don't apply to independent heating-oil dealers.
Zoom in: Massachusetts Gov. Maura Healey declared a State of Energy Emergency Monday over rising winter energy costs, unlocking nearly $150 million in relief and expanding assistance to middle-class households that heat with oil.
- Rhode Island has also declared an energy affordability emergency and directed $28 million in reserves toward winter electric-bill relief, and Maine Gov. Janet Mills announced $40 million in automatically applied electricity discounts for low-income residents.
Zoom out: The energy affordability crisis is compounded by the Trump administration's attempts to dismantle the Low Income Home Energy Assistance Program, or LIHEAP.
- The administration fired LIHEAP's federal staff at the Department of Health and Human Services in April 2025 and proposed eliminating funding for the program.
- LIHEAP is still running, but state administrators are operating without dedicated federal staff.
- The White House referred Axios to HHS, which said it "will carry out its responsibilities for funding Congress has made available" and that "HHS has the staff and capacity to distribute these funds in a timely manner."
The bottom line: Winter is coming, and Americans need to prepare for both the cold — and the prices — to bite.
Go deeper: How to save money on your electric bill this winter