Saga Of Propane Prices

Advertisement

And while we’re on the subject of flimflam artists and your money — we thought we might pause to listen to the pitch of the propane man.

Tell us if we sound too cynical.

Last year, winter propane bills in Rim Country doubled or tripled seemingly overnight. Residents stunned by $600 monthly heating bills staggered out into the snow in a daze mumbling plaintively, “How could this be?”

Oh my goodness, said the nice people from SemStream, who had recently bought the local propane company. Not our fault: Propane prices are lashed to the deck of the ship of oil prices — and as you can plainly see, oil prices have gone up to $150 per barrel.

So we struggled through the winter, burning bits of furniture in the fireplace.

Then, oddly enough — SemStream filed for bankruptcy. We’re still not sure we understand what happened —something about oil futures and price movements and betting that oil prices would go up. Or maybe down. Anyhow, SemStream got caught gaming oil price futures and lost a multi-billion dollar craps game.

So then the recession hits, stores close, folks lose their jobs, speculators weep their crocodile tears on their way to a bailout as they count up their final bonus checks.

And the price of oil falls from $150 a barrel to less than $50 a barrel.

At least we won’t have to burn furniture this winter, what with that 66-percent drop in oil prices.

Of course, turns out, we’ll only see about a 16-percent drop in heating bills this winter, according to the latest projections — maybe more if winter turns in a no-show as it has so far.

The company explained it all — something about summer supplies and surcharges and cost recovery and storage facilities. So maybe propane is only directly linked to oil prices when the price is going up.

Hmmm. What’s wrong with this picture?

We just hope that the Arizona Corporation Commission has finished its nice little nap and might be willing to focus on the mysteries of propane pricing. After all, guys, SemStream did go bankrupt while in the process of messing with oil prices right under your noses last year. Do you think we could kind of pay attention this year — given that the company has a state-sanctioned monopoly?

Or are we being too cynical, right before Christmas?

Comments

Use the comment form below to begin a discussion about this content.

Requires free registration

Posting comments requires a free account and verification.