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Propane prices on rise as oil market sees fluctuations

As political tensions and the global market push local gasoline prices above $4 a gallon, another type of flammable liquid is also on the rise.

Propane is the primary heating source for most homes in Tuolumne and Calaveras counties, and prices in the region are averaging about $2.89 a gallon for residential use, according to Drew Ricker, manager of ProFlame in Jamestown.

“Prices are directly linked to crude oil,” Ricker said. “Every morning I look at what gas is selling for and my costs move with that.”

Prices vary radically across California, according to the propane rate website checkpropaneprices.com. A gallon of propane can cost between $2.28 and $5.30 from county to county.
  

 

Ricker said the average customer in Tuolumne County uses 600 to 1,000 gallons of propane a year. But he said customers have become more frugal since the economy began to decline, opting to wear sweaters indoors rather than cranking up the thermostat.

“Everybody is pinching pennies,” he said. “There’s no one immune to that.”

Ricker said that despite a warmer winter, propane usage locally isn’t much lower than a typical year. He said ProFlame, which serves customers from Oakdale to Kennedy Meadows, frequently gets calls from customers who are surprised they are using so much propane even though daytime temperatures are higher.

Like gasoline, propane prices vary from week to week and from company to company. Also like gasoline, propane sellers and customers are at the mercy of global market forces.

With the market price of a barrel of oil near $108 on Tuesday, the nationwide average residential propane price remained flat at $2.86 per gallon, according to the U.S. Energy Information Administration. The price was 4 cents per gallon higher than the same period last year.

“As you see oil prices rise and fall, you will also see the price of propane rise and fall,” said Lesley Garland, president and CEO of the Western Propane Gas Association.

She said prices have held steady due to lower demand as a result of warmer winter temperatures across the state. But it’s a complicated balancing act between many different fossil fuels, she said.

Even though demand for propane might be lower, climbing diesel fuel prices are driving up the cost to transport it.

Unlike natural gas, which is funneled through city pipelines, propane is hauled on individual trucks. As a result, the number one cost for distributing propane is diesel fuel.

According to the American Petroleum Institute, California is the top user of propane in the nation, burning 576 million gallons of propane in 2010, the most recent year data was available.

Contact Ryan Campbell at This e-mail address is being protected from spam bots, you need JavaScript enabled to view it or 588-4526.


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