Propane Prices Spike, Relief Expected

| January 25, 2014 | 7:57 am
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Many propane consumers have seen a huge spike in the price they pay when it comes to filling up their tanks. The Missouri Propane Gas Energy Association says the shortage has been caused by more exports and increased demand due to the colder weather and higher crop yields. Propane is used to dry crops after harvest.

Click to hear KMZU’s Mandy Young speak with Executive Director Steve Ahrens:

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Ahrens has a theory as to why the prices are so high. “As the propane inventory has kind of gotten toward the low side, there has been what we believe could be potentially some speculative trading on those last barrels of propane,” said Ahrens. “Propane is a commodity traded on an exchange. And anonymous traders bid and buy and trade back and forth and run up the price on a commodity without ever having any intention to take physical possession of it.”

Ahrens said this is legal, but he hopes the government will take a look at it because propane is needed for many peoples’ homes and well-being.

This Association is trying to  find a solution to these rate increases. “We’ve asked the Missouri Attorney General’s Office to look at that. We’ve asked them to perhaps invited the National Association of Attorney Generals to take a wider look at that because this is happening to residents in states from Minnesota and Wisconsin all the way down through Missouri and throughout the Midwest.

Missouri Senators plan to meet with Missouri Attorney General Chris Koster this Monday to discuss the issue.

Some good news has been announced. Enterprise has put a couple of priority batches of propane. It will be sent through pipelines, taking priority over other products such as gasoline or diesel. “They’re giving propane priority to get that into the system. And I’m not sure that that’s going to go into any terminal access by Missouri propane companies, but this is such a nationwide issue that any relief at any point in the system is going to help us eventually.”

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