Will Propane Prices Go Down – Notice: Residential and wholesale price data for heating oil and propane will return on October 4, 2023.
Weekly heating oil and propane prices are collected only during the heating season, which runs from October to March.
Will Propane Prices Go Down
Note: Prices are in dollars per gallon, excluding tax. The values shown in the graph and the relevant data sheets of the previous week may be revised to account for late submissions and corrections.
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*demand = product supplied; Roughly represents the consumption of petroleum products because it measures the disappearance of these products from primary sources.
Release Schedule: Data is released weekly and updated every Wednesday after 1:00 PM. (Eastern Time). For weeks that include a Monday holiday, publication is delayed by one day.
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Financial Forms FAQs for State Energy Officials State Energy Offices 2018 SHOPP Workshop 2016 SHOPP Workshop 2014 SHOPP Workshop 2014 SHOPP Webinar 2012 SHOPP Webinar SHOPP Data Collection Training We are only two months away from the official start of heating. Months away. 3.5 MMbbl less than last year, or 2.6 MMbbl a five-year weekly low. Volumetrically, it’s a story similar to last summer: Propane exports are running high and while production is up it’s not fast enough to get inventories back to where we’d like to see them. But propane prices aren’t behaving like last year. At this time in 2021, propane prices were trending higher, both in absolute terms and relative to crude oil prices. This year, prices have fallen for the past four months and are much weaker than last year for crude oil. With low inventories and low prices, what are the prospects for preparing the propane market for the upcoming heating season? And what are the risks if there is a cold weather surprise? We’ll consider these issues and more in a blog series we’re launching today, focusing first on how we got here.
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The highly seasonal U.S. propane market is traditionally divided into two periods: April through September, when the industry builds inventories, and October through March, when inventories draw down to meet winter demand. Every year at this time, the industry is laser-focused on the status and pace of inventory increases, and whether it looks like there will be enough supply to meet the expected increase in demand during the upcoming heating season. Especially if an unusual spell of persistent cold weather hits the market. In recent years this calculation has become increasingly complex as exports have overtaken total domestic demand for propane.
As shown in the left graph in Figure 1, total US propane exports (blue bars) have been growing at a relatively fast rate, growing by about 10% annually over the last four years. In contrast, propane use is somewhat lower in the U.S. petrochemical sector (yellow bar segments), with ethane often the preferred feedstock for steam crackers, and consumer demand (green bar segments—residential, Commercial, Industrial, Agricultural, Automotive, Other) has been near flat for the last five years. The takeaway from this graph is that exports rose for the first time in 2019 to about 175 Mb/d over total US demand, and have continued to the point where exports now exceed US demand by a large margin. 500 Mb/dA presents a historic challenge globally. For propane industry businesses, however, in the nearly three years since retailers began taking health and safety measures in response to the novel coronavirus, they are now faced with many economic factors affecting their day-to-day operations.
Where once propane retailers could focus on a few top issues while running their business, the to-do list seems to have grown. And these aren’t small ticket items either. On the list of issues to overcome are inflation, labor disputes and supply chain disruptions, all while trying to take a deeper look at the other complete processes involved in safely delivering propane to end-use customers. are involved
Running a propane business in “normal” times is tough. But factor in the challenges posed by the COVID-19 shutdowns, including shocks to the U.S. economy and supply-demand imbalances, and retailers face another animal in today’s propane industry.
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“It’s one of those situations where people who are good at what they do and manage their companies sometimes excel at times when things are challenging and prove their worth,” Hampton of Lakes Gas said. Recognize your managers who have proven themselves during difficult situations. the times
Average U.S. gasoline and diesel prices rose after Russia’s attack on Ukraine in March and hit a new record high in June — about $5.02 for regular unleaded gasoline, according to AAA. Diesel around $5.82. Rising fuel prices this year have given propane industry leaders an opportunity to promote the fuel cost benefits of fleet vehicles with autogas.
“The costs associated with doing business in our industry are increasing, including investing in storage at the customer’s site. So this has been quite a challenge,” said Stuart Weedy, president and CEO of Blasman Gas and propane education and Research Council (PERC) Director says.
“Despite a challenging operating environment resulting from hot and inconsistent weather patterns, historically high commodity prices and inflationary factors impacting costs, we were able to effectively manage margins and costs,” said Michael Stivala, Subpropane President and CEO says.
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Superior Plus Corp., with operations in Canada and the United States, notes that it is working to overcome “wholesale costs, fuel costs, labor costs and other costs that are affected by inflation.” Ferrelgas points to “inflationary costs for materials and other commodities, such as steel used in tanks.”
US steel prices rose in late 2021 and have since retreated. Volatile raw material costs have contributed to the high cost of propane tanks.
Steel prices reached historic highs in late 2021 and early 2022 before settling later in the year. Citing rising raw material costs and challenges in the transport and labor markets, tank manufacturers Manchester Tank and Worthington Industries have announced price increases this spring – from 8 to 15 per cent depending on the product in Manchester. Up to 10% off steel LPG cylinders in Worthington.
Time will tell if propane tank prices decline, says Waddy, who worries about the future of the industry.
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“I hope to never slow down the opportunities for growth in our industry – the investment required to acquire new customers.” he says
Storage container costs have collided with retailers’ efforts to acquire the equipment needed for their operations, as supply chain inconsistencies have proven to be another barrier to doing business. Retailers have reported supply disruptions to propane cylinders, particularly 20-pound and forklift bottles, as well as other equipment such as parts and fittings.
“We reuse equipment that we’ve already got; we buy used equipment and refurbish it; and as far as parts and fittings are concerned, we try to order before [we] need them.” do,” says Matt Drennan, propane division manager at O.E. the mayor
Donna Howie-Germond, director of supply chain management at Paraco Gas, adds, “We took on second- and third-party vendors and started using companies we might not have used before. We really look at everything and challenge the way that We [use] to be more proactive than reactive to issues.
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“Our company has more employees than we’ve ever had,” Weddy says, referring to the 1,000 at Blasman Gas, “but we have more employees than ever because of growth opportunities.”
Filling open positions, especially for service technicians and delivery drivers, is the only obstacle keeping the company from “growing too much,” Waddy says.
Blasman Gas has engaged its local managers to work in the communities, finding quality candidates “and showing them what a great industry this is where they can make a really good living,” Weddy says. “They don’t have to sit behind a desk at a computer all day, and they can be outside and talk to people.”
While many propane industry leaders agree that attracting and retaining employees continues to drive business, LP Gas learned of some of the methods used by retailers to address their workforce challenges.
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DCC Propane has implemented an employee referral program to help with recruiting efforts, explains COO Ron Snyder during this year’s LP Gas Growth Summit. Sharp Energy has targeted driver training schools and technical schools, CEO Steve Farkas adds, while Pacific States Petroleum has adopted an employee stock ownership plan.
“Every employee became 100 percent owner of the company,” says Jason Edwards, general manager of propane operations at Pacific States Petroleum.
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