Winter fuel bills to rise in US

Soaring oil prices are forcing household fuel prices up

US households are facing higher fuel bills this winter as a result of the surge in oil prices to record highs.

Heating costs are set to rise sharply between October and March although the impact will not be felt until after November's presidential election.

Residential oil bills could jump about 28% while natural gas costs will rise 15%, the US Energy Department said.

With lower temperatures than normal forecast across parts of America this winter, fuel demand is set to rise.

Trickle down effect

The rise in US crude oil prices, which are 55% higher than at the start of the year, will filter through to household fuel bills, the US government said.

The average household in the north-east of the country will pay about $1,220(£687) in oil bills over the winter, three times as much as in 2001.

Natural gas customers in the Midwest will pay an estimated $1,000(£563) over the winter months, up from $870 last year.

Elevated oil prices are expected to result in higher heating oil prices US Energy Department

Publishing its annual winter forecast the Energy Department's statistical arm- the Energy Information Administration- said that crude oil prices were likely remain above $40 a barrel until the end of 2005.

"This winter, tight global oil markets and elevated crude oil prices are expected to result in higher heating oil, natural gas and propane prices," it said.

Cold winter

Crude oil prices have risen to a record high of more than $52 a barrel, fuelled by production glitches in the Gulf of Mexico after Hurricane Ivan and fears of disruption to supplies in Nigeria and Iraq.

Most consumers are unlikely to receive their first winter bills until the middle of November, neutralising the potential impact of fuel increases on the upcoming Presidential election.

Weather forecasters have predicted a colder winter than usual across the Southeast of the United States and Atlantic seaboard.

The EIA said that demand for natural gas was expected to be 1.5% higher this year.

However, it stressed that fuel inventories appeared to be adequate to "insure against unanticipated demand changes in case of severe weather".