JEFFERSON CITY, MO— Representative Joe Don McGaugh (R-Carrollton) is calling on Missouri Attorney General Chris Koster to investigate the steep increase in the price of propane gas this week. “When natural disasters happen, we have regulations in place to stop price gouging” McGaugh said. “The industry itself has caused this shortage, the blame lies with them. They should have the same regulations in place to protect the consumer.”

 

In less than 24 hours this week, the price of propane rose from $1.25 at the wholesale level, to $3.55 per gallon. While the cold weather is a factor, it is also clear that mismanagement by the industry for months in advance has contributed to most of the price increases. According to the U.S. Energy Information Administration, between September and October of 2013, exports of propane from the United States rose by 73,000 barrels a day. That level of exports coming so close to winter almost guaranteed a domestic shortage.

 

If the exported propane was sold to other countries at a lower price and that caused our domestic customers to be charged more, it is patently unfair. Some suppliers are saying that even with the higher prices, the propane simply isn’t available.

 

Some in the industry are blaming the wet corn harvest in North Dakota and Minnesota for the crisis. While propane is the primary fuel used to dry corn prior to storage, it shouldn’t be possible for a small market in one or two states to cause a nationwide shortage, especially when the corn harvest happened months ago.

 

“Many residents in my district make their living in the agricultural industry, and they count on propane for their livelihoods.” McGaugh said. “For the propane industry to create an artificial shortage that causes Missourians to dig deeper in their pockets, is something I will not tolerate. I have urged the Attorney General to do everything in his power to hold those who created this crisis accountable.” McGaugh continued, “While I am frustrated with those responsible, I want my constituents to know that this is in no way the fault of our local retailers of propane. This artificial shortage hurts them as well because they are not able to sell their products; they are unable to purchase the amounts they need to supply their customers. The blame for this lies squarely with the manufacturers.”