ENERGY
FUELS • PROPANE • LUBRICANTS
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Fuel and propane markets
Fuel markets
The fuel markets hovered in the same range for several months , with no breakout up or down until recently , when the hurricanes took some of the largest refineries offline for quite some time . So , why does that increase our price ? Of course , part of it is the speculative traders in the markets , but also this is where the actual supply and demand starts to kick in . Obviously , there was enough gas and diesel to keep the country supplied , with the exception of the hurricane areas . The problem is the products are now farther away than you are accustomed to buying them . So , the dominoes start falling and companies are having to look farther away to get the product . This not only leads to higher shipping costs , but human nature automatically raises the price to ensure they will get physical gallons .
Propane markets
A fundamental change has happened to the propane market , and that change is the expansion of the export terminals in the Gulf of Mexico . When the US price drops , propane companies can sell it off-shore for more money . The expansion to the Panama Canal has also allowed larger ships to pass through , saving them a lot of miles going to the Far East . Prices have risen about 30 cents per gallon since early June , and have been on a steady climb since then . A few years ago there was a glut of propane with all of the crude oil drilling , that helped lower the price domestically . But now we have expanded our export capability and are drilling fewer oil wells . That combination has led to lower inventories and higher prices .
What could cause it to drop ? A lackluster crop drying season and a warm winter . With the crops being behind the last few years , we are preparing for a busier fall than normal .
Whether the commodity is grain , fuel , or orange juice , it is all traded on an exchange . There is no one person or company that determines what the price will be . So , if you happened to own a large amount of gasoline , let ’ s say 100,000 gallons , and you are unable to use it up yourself , you would naturally sell it . At that point you would look for the person who would pay you the most money for it , and if no one offers you the money you need , you lower the price . If it is in high demand , you would wait out for the highest bidder . It is not really much different than going to an auction . When the highest bid is met , the product gets sold .
With our abundant storage , we will be well positioned for fuel supply this fall and winter .
Mid-County Cologne Storage & Blending Facitily
This is an example of an LPG carrier or LPG tanker from
www . conceptdraw . com . This is a gas carrier / gas tanker ship designed for transporting liquefied petroleum gas ( LPG ) in bulk .
Introducing Rich Smith Rich Smith is Mid-County Energy ’ s newest petroleum delivery driver . He ’ s also new to Minnesota , as he and his family is originally from Illinois .
“ There ’ s a lot to offer here ,” said Smith , who moved here in August . Smith doesn ’ t have any family ties to Minnesota ( his wife is from Montana ), but his family vacations here every summer .
Working for Mid-County , Smith is enjoying being part of a rural community , while still living close to the Twin Cities . Smith , his wife , and their two children ( ages 8 and 11 ) currently reside just outside of Chanhassen .
In his spare time , Smith is kept busy with his kids ’ sporting events .
“ They are in every sport imaginable ,” he said .
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