US stock market daily report (January 21, 2014, Tuesday)
January 22, 2014, Wednesday, 05:58 GMT | 01:58 EST | 11:28 IST | 13:58 SGT
In many states, particularly in the Upper Midwest, residents are being urged to conserve propane usage since liquid propane supplies are limited. Due to the LP shortage, propane suppliers are rationing. Many states, mostly in the Midwest and North have declared energy emergencies, loosening rules for propane transportation from other states, most of which are effective until the end of January. The emergency declaration permits propane shippers to drive more hours and focus on expediting propane shipments in order to mitigate tight supplies plus, getting the fuel to residents who need to keep warm. The shortage comes at an especially bad time as yet another Polar Vortex is making its way toward northern US states, sending frigid air with potentially double digit sub-zero temperatures.
Liquid propane (LP) is commonly used to heat homes in rural areas where natural gas lines simply don't reach. A colder than usual winter has increased the demand for propane. According to the Propane Education & Research Council, more than 14 million families across the United States use liquid or bottled propane to fuel their furnaces. Across the US over 1 million businesses rely on liquid propane.
The shortage of propane is not only as a result of lower than usual temperatures but also due to a greater than usual amount of propane used during November to dry corn crops during a rain-soaked harvest - according to the U.S. Energy Information Administration. According to the EIA, “Propane prices in the Midwest will likely need to rise to keep propane in the region.” Average propane prices were 58 cents per gallon higher than the same period last year, in the middle of January, per the EIA.
Per stats on EIA website, average price per gallon for propane on 12/02/13 was $2.566 and as of 1/13/14 price was $2.861 per gallon - rising 0.295 per gallon in just over a month time period. In 2013 on 01/14/13 average price per gallon was $2.268. Propane demand for week ending 01/10/14 was 1.736 million barrels per day compared to week of 12/27/13 at 1.407 million barrels per day.
For residents that heat their homes with propane, here's some advice:
- Don't wait for an empty tank before calling your liquid propane supply company. Contact them well in advance to allow for extra time due to the propane shortage.
- Turn thermostats down slightly to conserve the propane you have.
- Check on your relatives and neighbors, especially elderly folks, just to make sure they're taken care of during these cold weather snaps.