The Woodward News

Local News

February 7, 2014

Propane price continues to rise

Woodward, Okla. — As the week of snow, ice and frigid temperatures draws to a close, a winter weary Oklahoma public begins to understand what it might feel like to live in Minnesota.

But exacerbating the feelings about the weather could be the price of propane, which has nearly doubled since the beginning of the winter season in October, according to the U.S. Energy Information Administration (EIA).

The average price in the U.S. in October was about $2.20 per gallon. Around the last week of January, when a protracted winter storm and other factors stressed supplies in the midwest and east, prices shot up sharply to more than $4 per gallon, according to EIA figures.

Propane is What?

"I have never seen the price of propane go this high or rise this sharply," said former propane hauler, Sammy Burch.

Burch hauled propane full-time for 5 years in Oklahoma and before that in Kansas, part-time for 10 years.

"I just wonder now how many old people on Social Security who are choosing to heat their homes instead of pay for their medications," Burch said.  

At present, there are approximately 400,000 propane customers in the United States, according to statistics from the Oklahoma LP Gas Commission.

According to Burch, the average home uses about 200 gallons of propane during a cold month.

"That's $800, if they are buying it now and I just don't know who can fit that to their budget," she said.

From Now On I'll Buy It Early

That reality is hitting many people who have not contracted with their local propane provider for a more stable price and instead are on a call-in basis for their propane needs, said Laverne Farmers Cooperative Manager Phil Welty.

Every year Welty signs a contract to the wholesaler where he purchases propane. The Mont Belvieu wholesaler agrees in a contract to sell the commodity to those, such as Welty and other cooperatives at the lower-off-season price.

"That's a way I can keep the costs down for my regular customers," Welty said. "If I sell all my contracted gas to people who call in but aren't regular customers, I won't have enough left at that price to service my regular customers who I have agreements with."

So, at present, if you were a customer signed up on a "keep-full" status, as it is called, with Laverne Farmers Cooperative, then you are still getting your gas for about $1.78 or so. But if you called in Thursday to get gas delivered and you have not established a relationship with a provider, you could pay up to $4.20, Welty said.

That system is common to most propane retailers, Burch said.

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