Propane prices retreat but still are unusually high; distribution troubles mount

[Omaha Steve]

Source: Omaha World Herald

By Russell Hubbard

Disruption continues in the market for propane gas, the heating fuel for thousands in Nebraska and Iowa, with higher-than-normal prices, long waits for truckers at distribution hubs and no relief in sight from Mother Nature.

Prices began to rise dramatically — 70 percent over one weekend — late last month. Reasons included a fierce cold snap depleting inventories that were already low from heavy fall use by farmers drying crops; curtailed pipeline capacity due to maintenance and conversion of the lines to carry other fuels; and higher exports in 2013.

This week, propane at the Conway, Kan., hub was quoted at an average wholesale price of $2.45 a gallon, down by more than half from about $5 a gallon in late January, but still a little less than three times the 85 cents a gallon quoted a year ago. Prices at the Kansas hub serving the Midwest are at about a 92-cent premium to those at Mont Belvieu, Texas, the U.S. propane distribution and storage point for the Southern United States.

A year ago, the spread between the Midwestern and Southern hubs was only about 3 cents, the big jump illustrating the shortage and high prices in the nation's center.

FULL story at link.


Read more: http://www.omaha.com/article/20140204/MONEY/140209553/1697#propane-prices-retreat-but-still-are-unusually-high-distribution-troubles-mount

[Capt. Obvious]

1. I might get a new truck now

[JackInGreen]

2. ye know...

I came in here SPECIFICALLY to see how long it would take before a Hank Hill reference, and you have not disappointed.

[Capt. Obvious]

4. It was the equivalent of FIRST

And I love the Hank Hill image I found.

[Sassysdad]

3. Here in Upstate NY..

(Montgomery Co.) it doesn't matter if you have a 100gal tank or a 1000 gal...my supplier is rationing to just 60% as opposed to a "full" 80%...

[WhiteTara]

5. I should have gotten more propane than I did

last week when it was $2.449 a gallon. Darn.

[NickB79]

6. My tank was filled Dec. 26 at $2/gal

Last week, one of my coworkers was bitching because he was quoted $4.99/gal!

Thankfully, we have a woodstove as well, and have added a shitload of insulation to the house the past few years, so we won't need another fill until March, but god damn. I still turned down the thermostat a few degrees and broke out the electric space heater just to be safe.

[DemoTex]

7. Filled in December @ $1.86/gal (Upstate SC)

That will last me a year, at least.

[NickB79]

9. You burn propane fast when it's -25F outside

And the windchill is down to -40F

I'm tempted to let the company I lease my 500-gal. tank from take it back and buy a 1000-gal. one instead. It would be a bitch to fill, but it would last me forever so long as I keep weatherizing our house and burning firewood.

[dmosh42]

8. Another "fake" free market commodity!

[warrant46]

10. +1