The price of heating fuel is dropping alongside the mercury in thermometers in New England, providing a reprieve to the part of the country that is the most dependent on home heating oil.
The average statewide cash price for heating oil in Maine has dropped to its lowest level since 2008, when global financial markets collapsed. The average price Monday was $2.99 a gallon, a drop of 4 cents from the week before, the energy office said Tuesday. The average price of kerosene dropped 3 cents per gallon while propane held steady.
Energy officials said they expect prices to continue to fall, though not to the same level as six years ago.
The lower prices are a relief for all who heat with oil, said Julie Dawkins of Gorham, a striking FairPoint Communications worker who said she and fellow union members have had to save money.
"The talk on the picket line has been about how gas prices are down, oil prices are down. And it's really making a difference to these people who are counting every penny now," said Dawkins, who added that "winter months in Maine are hard on families."
Prices of crude oil are falling in part because of Organization of the Petroleum Exporting Countries' decision to not cut production, Maine officials said. Gasoline prices have also continued to plunge nationwide, falling 23 cents in November to a four-year low of $2.76 per gallon on average, AAA said.
The price cut is especially helpful for residents who receive federal heating assistance money, said Deborah Turcotte, spokeswoman for state agency MaineHousing. The agency anticipates serving 45,000 households during the heating season, with an average benefit of $617, Turcotte said.
The savings make a big difference for low-income residents of Maine, which the U.S. Census Bureau says is much more dependent on oil heat than other states.
"People of lower income who need heating assistance will now be able to have more buying power," Turcotte said.
Somewhat counterintuitively, the falling prices are also good for Maine's heating oil dealers, said Jamie Py, president of the Maine Energy Marketers Association. The low prices inspire more buying and encourage customers to pay with cash instead of credit, which improves cash flow, Py said.
Py added that the lower prices also result in dealers spending less on wholesale and operating costs.
"People have more money. When customers have more money, they might be more likely to use your product more," Py said, adding that the drop in price also allows heating oil to be competitive with natural gas.
The highest price for heating oil on Monday was again found in central Maine, where prices reached $3.40. The lowest prices were in western and southwestern Maine, where the low mark was $2.60. Kerosene and propane were least expensive in eastern Maine.
AP writers David Sharp contributed to this report.