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Federal Government invokes Emergency Powers for..Propane?

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posted on Feb, 21 2014 @ 11:11 AM
Yes, you all heard the title correctly and it's descriptive to the story here. First, I'll say that of all the causes I could imagine to overstep federal authority in dictating down to the level of individual operations inside pipelines, this is probably the most noteworthy. In some ways, that makes the need to see and stand up over it all the more important.

The Federal Energy Regulatory Commission has used for the first time emergency powers it has under the Interstate Commerce Act to try to alleviate a shortage of propane in the Midwest and Northeast, including Vermont.

It's hard to say if these specific "Emergency Powers" are among the many we've debated and speculated over the use or abuse of in what has come over the last 10+ years, or back to Eisenhower in terms of broad executive power for commanding private sector business. It seems likely though...

Mollie O’Dell, spokeswoman for the National Propane Gas Association, which asked the Federal Energy Regulatory Commission to issue the emergency order in early February, said the regulatory agency was responding to an unprecedented crisis in propane supply.

“A situation like this has not occurred in the 100-year history of the propane industry,” O’Dell said.

Now that last part, I will agree with. When this has settled, I would love to see some honest to goodness and sincere investigation done into just HOW propane rose by 400-500% in costs over just a year's time.'s been a cold winter, and we've had dozens of cold winters before. Many, much worse than this one for the region we're talking about here.

It's interesting too, that the Emergency Powers were invoked on the request of a private trade group. The whole thing is an area I'd sure like to know more about for how it came to happen this way. Especially the "unprecedented" Emergency response being talked about here. Federal dictates of what individual private pipes are carrying, on what schedule?

Wow... The future is here, and it's a cold place where bureaucrats are making decisions across such a variety of industries they have no functional working life experience in. What could ever go wrong?

edit on 21-2-2014 by Wrabbit2000 because: (no reason given)

posted on Feb, 21 2014 @ 11:24 AM
From source:

O’Dell cited a combination of factors for the problem, including a major pipeline in the upper Midwest shutting down for most of December, extreme cold, unusually high demand for drying crops in the Midwest last fall, and exports.

Thats interesting. The perfect propane storm. Nothing a bureaucratized, single source monopoly utility can't handle I am sure.

posted on Feb, 21 2014 @ 11:28 AM
reply to post by Wrabbit2000

I would love to see some honest to goodness and sincere investigation done into just HOW propane rose by 400-500% in costs over just a year's time.

Going out on a limb here with a wild guess (deduction?)
    1. Propane is a commodity
    2. Other commodities have been heavily manipulated recently
    3. I suspect big banks JP Morgan in particular
    4. See JPM's moving/storing/hiding aluminum stockpiles scheme for more info

Just a guess though and it could be another large bank, Sachs, Chase, etc.

posted on Feb, 21 2014 @ 11:30 AM
Kind of makes me glad I only have to worry about keeping my grill's tank full in hurricane season, that works out to 1-2 refill purchases annually. It's already a bit steep to me to fill it compared to a decade+ ago, I can't imagine having to rely on propane in larger quantities to keep warm with at these costs. Yikes :/

posted on Feb, 21 2014 @ 11:32 AM
reply to post by Wrabbit2000

It's the exportation of propane, and greed, that has brought this about, Wrabbit. As you can see from the graph, production is at an all time high. Yet, the price for it here in the U.S. keeps soaring at unprecedented rates.

There is not a lack of domestic supply, it's being diverted for higher profits. We the people can just suck sour lemons and keep digging deeper in our empty pockets to heat our homes.

Sail Away – Propane Exports Exceed 400 Mb/d for the First Time

Sail Away – Propane Exports Exceed 400 Mb/d for the First Time
published by Kelly Van Hull on Tue, 01/28/2014 - 20:00

We’ve been talking a lot over the past year about the need for increasing exports to balance the U.S propane market as growth in production from gas processing plants outruns domestic demand. U.S. propane production from gas processing has increased by over 100 Mb/d since January 2013, and there’s lots more to come. For the first time U.S. propane exports exceeded 400 Mb/d in October 2013 thanks to growing U.S supply and infrastructure developments including dock expansions by Enterprise and Targa. But just after exports ramped up, the propane market was hit by a couple of wild cards – a late and very heavy crop drying season and a series of record cold temperature events. In today’s blog, we continue our series covering the record setting 2014 NGL markets.

Before we jump into the export analysis let’s first spend a minute looking at the U.S propane market. Figure #1 below depicts the rapid growth in U.S. propane production from gas processing plants that occurred from January 2013 to October 2013, the latest reported data by the U.S. Energy Information Administration (EIA).


edit on 21-2-2014 by Destinyone because: (no reason given)

posted on Feb, 21 2014 @ 11:33 AM
Being as I use about $16,000 gallons of propane a year for my business this has been a bad year. Prices went up over a dollar a gallon on my end and when I said something to my distributor I was told that they are selling at a loss to not lose customers and that should this continue many of the smaller suppliers (like Kamps) will be driven out of business.

This is a contrived crisis, like any other fuel supplier the markets are manipulated for profit. Given the demand for heat with the unusual winter it is nothing more than price gouging.

Thankfully by the time my business is in full swing it will be summer and the prices will fall back to what I am used to paying, 1.38 a gallon.

posted on Feb, 21 2014 @ 11:45 AM
reply to post by Wrabbit2000

there's no shortage, it's a lie.

Feb 20 (Reuters) - Veresen Inc said on Thursday that Canada's National Energy Board had approved its request for a license to export natural gas for a U.S. liquefied natural gas project.

The company, which operates pipelines and gas-processing facilities, said the board had approved a license to ship 1.55 billion cubic feet per day of gas to its Jordan Cove LNG project at Coos Bay, Oregon.

While seven proposed LNG projects planned for British Columbia's northern Pacific coast have received LNG-export licenses, Veresen's approval is the first for shipping Canadian gas for a U.S. project.

The gas will be shipped via existing pipelines to the Malin Hub in southern Oregon. From there, a planned 232-mile (370-km) line will take the gas to the Jordan Cove site.

The Jordan Cove project will supply 6 million tonnes of gas per year to Asian markets.

edit on (2/21/1414 by loveguy because: (no reason given)

posted on Feb, 21 2014 @ 11:47 AM
Hank Hill is gonna flip his lid!!

posted on Feb, 21 2014 @ 11:59 AM
The law of supply and demand ceased to be operating principal 50 years ago when speculators took over the market.

It can work to your advantage if you want to do the leg work.

posted on Feb, 21 2014 @ 12:07 PM
reply to post by olaru12

It's people working it to their advantage, that got us to where we are today. I personally think, passing out of export licenses, like Halloween candy for driving one's stock prices up, for a few select to gain from, should be illegal.



edit on 21-2-2014 by Destinyone because: (no reason given)

posted on Feb, 21 2014 @ 12:22 PM

reply to post by olaru12

It's people working it to their advantage, that got us to where we are today. I personally think, passing out of expert licenses, like Halloween candy for driving one's stock prices up, for a few select to gain from, should be illegal.



edit on 21-2-2014 by Destinyone because: (no reason given)

Don't blame me....

I'm just a dabbler in the commodities market.

The deregulation cycle started years ago and now the chickens have come home to roost. Who do you think started the deregulation juggernaut with the energy companies, banks, outsourcing etc.? There's where the blame lies; not with us investors/gamblers.
edit on 21-2-2014 by olaru12 because: (no reason given)

posted on Feb, 21 2014 @ 12:38 PM
reply to post by Wrabbit2000

What people do not realize is any product shipped from a US port that is enroute to a second US port is required by federal law to be transported by US cargo vessels. We just had this issue pop up with the salt shortage on the east coast. Propane stocks were extremely low due to the overall number of winter storms that hit the area (up to 9 now).

The reserves the Federal Government has are generally not released. Some of the requirements needed for a release requires the federal government to issue a disaster declaration / state of emergency. We have seen this done in the past with releases from the strategic oil reserves to assist in stabilizing supplies and containing cost in the short term.

This is also along the same criteria needed for FEMA to be activated. State of Emergency / Disaster Declaration at the local / state level and then a sign off of the same at the federal level.

As for shortages again it goes back to the harsh winter storms that have come through. There is not much time between storms so the snowball effect is impacting the area. Natural gas is generally not something we have shortages of. Recently the Us just became an exporter of natural gas (much to the irritation of China).

As much as I distrust this administration I don't think this is sinister. I just think we are seeing the federal government having to follow its own guidelines in order to do what needs to be done.
edit on 21-2-2014 by Xcathdra because: (no reason given)

posted on Feb, 21 2014 @ 01:03 PM
I think it is a scam, pure and simple as stated just the last few replies.

And even if there were a shortage, it may have been caused by sending the propane to dry out last years harvest. Why couldn't they have used propane from the southern half of the country for that?

This crisis has "Criminal neglect" written all over it.

posted on Feb, 21 2014 @ 01:33 PM
Expecting ANYthing that is important from a life-threatening stance to stay the same price or availability year over year is a fool's errand. Complaining about it is a little strange given the kind of topics that are covered here at ATS on a daily basis.

What part of 'people will try to make money no matter who is hurt' and 'the corporations are bloodsucking leeches that control our government' do you not understand yet?

It's one thing if your only purchase of propane is to fuel up your BBQ (good luck being able to afford the meat for it now in any event; once the drought from years past is added to this year's winter weather kill, I can't imagine anyone being in the beef business much longer), but if you use propane to heat your house, be prepared with a secondary and tertiary form of heat source if you live in that harsh a climate, or an area of the country where it could potentially be harsh. Think electric heaters and closed off perimeter rooms, and firewood as a last resort. You should also have at least a dozen extra blankets on hand for every bed; the time I was in a power outage in 20 degree temps for 9 days I found you can actually sleep comfortably with 7 blankets on the bed.

Rather than complaining because someone is taking advantage of bad weather, figure out how you're going to respond to it, up to and including moving somewhere less life threatening. It's starting to look like the entire midwest as far south as Texas and Georgia and the entire northeast are going to be weather disasters on an on-going basis, and the west coast is getting irradiated.

So, where's a good place to move to? Hopefully somewhere where the government doesn't feed its enforcers steroids?

posted on Feb, 21 2014 @ 01:52 PM
The person who delivers the propane is working on a percentage, they are making smaller deliveries though and their profits are not increasing much....they will get investigated. The reason the price went up so high is that the people along the way and the suppliers made a lot of profit...they will probably not get investigated.

That is what happened when the price of oil jumped up about a half a dozen years ago. I remember when they deregulated the price of fuels, back in the good old days when fuels were cheap. It is alright for the money men to make huge profits but the small businesses with lots of overhead are not allowed to make any more even though their volume decreases, meaning they lose money to satisfy the law.

I suppose this is like this to keep the small businessman in his place and poor, when they go belly up a new business starts up and the cost of the startup makes the economy go up. They are no longer grandfathered in and they have to buy a lot of new equipment sold by the people on the super high prices.

This is all normal in this new society. It is the way it is. Until we get control of congress back in the people's hands, this will undoubtedly never change. The government keeps saying they are going to do something to appease the people, but I never hear of anything happening. It just makes us think they are concerned. A small contribution to the political party by the one doing this and all is fine. Contributions seem like blackmail money to me. Same with fines given to big industry.
edit on 21-2-2014 by rickymouse because: (no reason given)

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