Natural Gas is generally cheaper than Fuel Oil. This is primarily due to the differences in their production costs, energy content, and market dynamics. According to the U.S. Energy Information Administration (EIA), the average price of natural gas per million British thermal units (MMBtu) has been consistently lower than the price of fuel oil over the past decade. For instance, in 2021, the average price of natural gas was around $2.50/MMBtu, while fuel oil averaged about $3.50/MMBtu. This price difference is attributed to several factors.

Firstly, natural gas is often more abundant and easier to extract than fuel oil. Advances in hydraulic fracturing and horizontal drilling have significantly increased natural gas production in the United States, leading to a surplus and lower prices. In contrast, fuel oil production is more complex and requires more energy-intensive extraction processes, making it more expensive to produce.

Secondly, the energy content of natural gas is higher than that of fuel oil. Natural gas contains approximately 1,020 BTUs per cubic foot, while fuel oil contains about 1,200 BTUs per gallon. This means that natural gas provides more energy per unit of volume, making it more cost-effective for consumers and businesses.

Lastly, market dynamics play a role in the price difference. Natural gas is often used for heating and power generation, while fuel oil is primarily used for heating. During the winter months, when heating demand is high, the price of natural gas can increase due to higher demand. However, fuel oil prices tend to be more volatile and can fluctuate significantly due to geopolitical events, such as supply disruptions or changes in global oil prices.

In conclusion, natural gas is cheaper than fuel oil due to its lower production costs, higher energy content, and market dynamics. The EIA data supports this trend, with natural gas prices consistently lower than fuel oil over the past decade.