Sunday, February 9, 2014

The Oil Boom Doesn't Care if Your Chickens Are Freezing to Death



Propane is a byproduct of both natural gas production and crude oil refining. Just in the past year, its production has spiked by 15 percent, and a good chunk of that new production is considered surplus, to be exported from brand new fuel terminals. ...

But, according to The New York Times, it's quite the opposite. Propane fuel prices have shot up in some areas by more than $2 a gallon since the beginning of winter, and as of the end of January, the national wholesale average for propane had more than doubled in less than a month's time. ...

... state attorneys general from across the Midwest are claiming price-gouging and opening top serious investigations, while local and state authorities race to provide emergency assistance to squeezed households. ...

Last fall was wet, which meant harvesting wet corn. So, some larger percent of February's missing propane went to drying out some corn in November. ... This put a hurt on local propane stocks.  ...

Hundreds of miles to the southeast, at the Del-Ray Ranch here in Calhoun County, Ala., the concerns were just as intense in the state’s $15 billion a year chicken business. Ray Bean began his week with the realization that the propane supply that helps him and his wife to raise more than 500,000 chickens a year had dwindled to zero.

So, to recap, American corn producers operating with help from government farm subsidies were buying propane with, in some part, your money to dry out their corn harvest. For reasons that remain somewhat a mystery, the American propane infrastructure, which is about as resilient as a dog fart, apparently, didn't recover or refill in time for our current full-on epic winter. And, to mess things up even more, only a month before the corn harvest propane crisis, producers were racing like hell to get propane out of the domestic market with help from brand new export terminals.
There's your oil boom: paying for others' profits while your chickens die horribly and people you didn't vote for figure out the economics of offering supply relief during a heating fuel crisis. Good times.

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