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Propane Prices Skyrocket

Propane prices have nearly doubled this week as suppliers try to move the product to where it's needed most.
Northwest Arkansas - Propane prices have nearly doubled this week as suppliers try to move the product to where it's needed most.

Extreme cold created a spike in demand in the Midwest and Northeast, and prices have followed suit.

Don Anderson owns Anderson's Propane & Gas in Hindsville. He says prices have jumped by more than $2.50 per gallon just this week.

"About 3 weeks ago it started going up slowly, and in one week we got 55 cents, which we thought was crazy," he says. "We've never seen it this extreme."

Trey Myers visited the store Wednesday, and was shocked to see the price.

"I don't know what to do," Myers says. "I don't know how much my tank's got out there, probably got about ten percent."

Myers hopes his propane will last for a couple more weeks, because at nearly $4.39 a gallon, his main heat source is out of reach.

"It's cheaper to put gasoline in there," he says. "That's sad... you're talking about using 2 or 3 tanks a winter... It was around $400 to fill up a 200 gallon, and now it'd be about $800, and there's just no way."

Anderson has been selling propane for more than 30 years, and says this weeks price jump is unheard of. He says the cold weather, and increased demand to the North created the perfect storm. Industry watchers say high demand for grain drying last fall used up inventories before winter hit, and now the weather is making it tough for delivery drivers transport the gas.

"We've had a few bumps like in Katrina and stuff like that, but nothing of this magnitude," Anderson says. "There's product, but it's just not in the right place, where the cold is, and they're driving the price up."

Anderson expects to see relief around Valentine's day, and wants his customers to wait it out.

"Let this price come back down to a more realistic number that we're all accustomed to," he says.

Unfortunately, with just ten percent of a tank, Myers isn't sure that's an option.

"I'm just going to have to go around and see if I can find somebody to give me some help," he says. "Then just hope we've got a milder winter coming up."

More than a dozen states, including Arkansas, have declared emergencies, lifting restrictions on transporting the product. Texas, where supplies are still available, just joined the list.

Anderson expects to see another price increase Thursday, but believes it may be the last. On Monday he plans to travel down to Texas to try to restock.
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