Heating Oil Prices 2027: Yearly Cost Calculator by State

How to Use the Heating Oil Cost Calculator

It takes about a minute. Work down the form:

1. Check the state. The calculator picks it from your location and shows it in the title. Wrong state? Hit “change” and enter your ZIP. Fuel prices and the climate both switch to match.
2. Home size. Count heated square footage only. Leave out the garage and any basement you don’t heat.
3. Heating oil price. It starts at your state’s average. If your last delivery ticket shows a different price, type that in. It moves the result more than anything else on the form.
4. Equipment and efficiency. Pick an oil boiler (radiators or baseboard) or an oil furnace (ducts and vents). “Standard” means 87% for a boiler and 84% for a furnace. Choose “Low” (71% or 69%) if the unit is 30 or more years old.
5. Duct insulation (furnaces only). Ducts that run through a cold attic or crawlspace lose heat before it reaches the rooms. Bare metal ducts mean “Uninsulated”.
6. Home insulation. “Average” assumes R-13 walls, the usual 2×4 wall with fiberglass batts. Go a step lower for a drafty older house, a step higher if you’ve added insulation.

The results lead with the cheapest way to heat your house, then show oil’s yearly cost and gallons, the other fuels ranked against it, and a price range for a new oil boiler or furnace.

For a sense of scale: as of fall 2026, oil averages about $6.20 a gallon nationally, and a 2,000 sq ft house in a cold state burns roughly 830 gallons a season. That puts a typical bill around $5,000-$5,400.

Where the Numbers Come From

Your home’s heat loss and your area’s heating degree days in an average year set how much heat the house needs. That figure is divided by burner efficiency, so an older unit burns more oil for the same warmth. Prices come from U.S. Energy Information Administration data and are refreshed regularly.

The natural gas and propane figures assume the oil unit is swapped for a condensing boiler (95% AFUE) or furnace (96%), with nothing else changed. The heat pump figure assumes a cold-climate ductless system at COP 2.9. Only the oil price is editable; gas, propane and electricity use state averages. To try your own rates for every fuel, use the home heating cost calculator.

Three Ways Off Oil, Ranked

The fair way to compare fuels is the cost of 100,000 BTUs of heat, shown here at this article’s example rates. Oil and propane also lose 5-15% up the flue, so the real gap is a bit wider than it looks.

Option	Cost per 100k BTU (example)	When it wins
1. Natural gas	About $2.95 at $2.95/therm	Any time a gas main runs past your house
2. Cold-climate ductless heat pump	About $1.90 at $0.19/kWh; about $5.45 at $0.54/kWh	Electricity under about $0.35/kWh, or you have solar
3. Propane	About $2.90 at $2.67/gal (1.1 gal vs. 0.7 gal of oil)	No gas line, and power too pricey for a heat pump
Staying on oil	About $4.43 at $6.20/gal	No gas, pricey power, and a well-tuned burner

Natural Gas: The Easy Win If You Can Get It

A therm of gas is roughly 100,000 BTUs, so the therm price is your cost per 100k BTU. A gallon of #2 oil holds about 140,000 BTUs, so at $6.20 a gallon the same heat runs about $4.43. That’s roughly 50% more than gas at Massachusetts-level rates of $2.95 a therm.

For a typical 2,000 sq ft house at today’s prices, the calculator puts the savings at roughly $2,200-$3,100 a year with a condensing gas boiler, and a few hundred dollars less with a basic 86% gas boiler. Gas equipment can also go about five years between check-ups, so the yearly $130-$200 oil tune-up goes away. And a 95%+ gas furnace usually costs no more to install than an 85% oil furnace, often less. Get a range for your house with the furnace replacement cost calculator.

Propane: Cheaper Fuel, Clumsier Logistics

Propane carries about 91,500 BTUs per gallon, roughly two-thirds of what oil holds, so you’ll buy close to one and a half gallons of propane for every gallon of oil you stop burning. That used to kill the deal. At current prices it often doesn’t, because propane sells for well under half the price of oil per gallon in a lot of states. Check the propane line in your results before you decide.

Running out is also worse. An oil burner can limp through the night on a few gallons of gas-station diesel (call your service tech in the morning), but an empty propane tank means no heat until the truck shows up. And where power is reasonably priced, a cold-climate heat pump usually beats propane on running cost anyway.

Heat Pump: Your Electric Rate Decides

Take a 2,000 sq ft house in Illinois, a cold state with middle-of-the-road energy prices:

• Oil at about $6.30 a gallon: roughly 833 gallons a season, or about $5,240.
• Ductless heat pump at about $0.19 per kWh: roughly 10,152 kWh, or about $1,950.

That’s close to $3,300 a year saved, more than half the oil bill.

Now run the same house at $0.54 per kWh, a rate I’ve seen on my own Massachusetts bill, and the heat pump costs about $250 more per year than oil. Same equipment, opposite verdict. Use the rate on your own bill, not the state average, and check it in the heat pump calculator.

Millions of oil homes, mostly in the Northeast, have no gas main nearby and never will. For them a whole-house ductless mini-split is usually the only way out, and it pays off when one of these lines up:

1. Fair power prices. Under roughly $0.35 per kWh. At today’s oil prices the running costs cross near $0.50, but you want a healthy gap to pay back the install.
2. Cold-climate equipment. Built to heat in deep cold, not borrowed from a mild-climate catalog.
3. Solar on the roof. A large array flips the math even where utility power is expensive, because you make a good share of your own.

A word on COP. One kilowatt through a baseboard heater gives you 3,412 BTUs. A heat pump at a coefficient of performance (COP) of 3 moves about 10,236 BTUs with the same kilowatt. Our calculator uses a cautious COP 2.9 (about 9,895 BTUs per kW); some multi-zone cold-climate setups are rated well above 3.

In the South the case is even easier: power tends to be cheaper, and the same mini-split cools the house in summer. Price a layout for your rooms with the mini split cost calculator, and see what it will draw from the grid in our guide to heat pump electricity costs.

Two Heat Pump Traps to Avoid

The “central” heat pump. Ducted central heat pumps are built for mild winters and fade fast below freezing. Don’t accept anything rated above -5°F, and lean toward units rated to -15°F with a base pan heater. Check the model on the NEEP cold-climate air source heat pump list. When I went through it, the only “central” entries were VRF systems, basically big mini-splits feeding a central air handler. No standard central units from the big furnace brands made the cut.

Even the best units have a floor. Most quit somewhere around -13°F to -15°F, and near that point they may deliver only about 60% of rated output. Size the system with that in mind.

Rebates that don’t care about cold. Many states and utilities pay heat pump rebates of several thousand dollars, and some accept any listed heat pump, cold-climate or not. I once rented a place where the owner had installed a standard unit just to collect the rebate, and the house never got warm. Readers have written to us with the same story. Look up the exact model number on the NEEP list yourself before you sign, or you may end up with a costly air conditioner that can’t handle January.

Staying on Oil? Cut the Bill

No gas line and pricey power? Oil may still be your cheapest heat, and you can make it cost less.

Why Oil Equipment Stops at About 87%

Most oil-heated homes have a hot-water boiler rather than a furnace. Either way, don’t expect a high-efficiency model: oil units top out near 87% AFUE, while the best gas equipment hits 98%.

Two things hold oil back. The burner balances fuel against air: tune it lean for peak efficiency and it leaves soot that slowly clogs the chimney, tune it for a perfectly clean burn and efficiency drops. And there’s only one heat exchanger, so whatever heat it misses goes up the flue. Condensing gas equipment adds a second exchanger and wastes only 2-5%.

The cheap fix: hire an independent oil burner tech for the yearly tune-up, not the company that delivers your fuel. A supplier’s tech has little reason to chase efficiency when selling you more oil is the business. Expect to pay $130-$200; the fuel you don’t burn usually covers it.

When a New Oil Boiler Pays for Itself

A boiler past 30 years old is probably running at about 70% efficiency. Swap it for a new 85-87% unit and your yearly fuel use drops by roughly a fifth. For a 2,000 sq ft Massachusetts home paying about $6.50 per gallon, that’s around $1,200 a year.

If oil climbs toward $7.25, the yearly savings pass $1,300. Add the repair bills that go away with the old unit, and a $7,920-$13,200 replacement can break even in six to ten years. Get a figure for your house with the boiler installation cost calculator.

Quick Answers About Oil Heat

How many gallons of oil does a 2,000 sq ft house burn?

With a modern burner in a cold Midwestern climate, figure roughly 800-850 gallons a season. An older boiler, leaky walls or a colder location will push that up.

Is oil or electric heat cheaper?

It comes down to your electric rate. Around $0.20-$0.30 per kWh, a cold-climate ductless heat pump beats oil easily. At today’s oil prices the two cross near $0.50 per kWh, and above that oil wins.

Ready to get off oil, or just want a better boiler? Get free quotes from local heating contractors and compare real numbers before you commit.