How is propane priced?

Because propane is a byproduct of natural gas processing and crude oil refining, the price of propane usually falls between those two commodities. The prices of all of these fuels can fluctuate based on economic, political, and other factors that affect global markets. But, compared to conventional fuels and some alternative energy sources, propane generally costs less, even when fuel prices fluctuate.

Propane prices are also affected by fluctuations in supply and demand, such as during extremely cold or warm weather. In colder months for instance, heavier home heating needs can boost demand for propane and cause propane prices to rise. Those changes may be reflected in the wholesale price of propane for us, and, consequently, in the prices you pay as a consumer.