Propane, heating oil hit record prices amid price gouging concerns

First Posted: 2/1/2014

As prices for heating oil and propane reach all-time highs around Ohio and the U.S., state Attorney General Mike DeWine said he’s probing complaints that consumers are becoming victims of price-gouging.

The extreme cold snap and high demand have for weeks put propane suppliers in a squeeze. Sources have been sought as far south as Texas and Louisiana to restore inventory.

In Ohio, residential tanks are being short-filled to spread the supply. There are reports of trouble lining up refills. The key issue is getting enough propane into Ohio via truck to meet the demand.

The maximum time truck drivers can be on the road moving propane from state to state has been relaxed by both state and federal authorities.

One of those who has run out of propane is Nancy Karch, 72. Her home is six miles outside Celina in Mercer County. She is recovering from a heart attack and had to move in with her son in Wapakoneta because her home became too cold. Although her tank was filled with 200 gallons on Jan. 2, this week the tank slipped to about five percent full and her supplier said she couldn’t get a delivery for at least seven days although she had already paid for the fuel.

“I can’t handle that,” she said. “I don’t need much, just a little bit.”

A patch of relief is coming in the form of moderating temperatures. For at least the next 10 days, the region should be in a more typical winter pattern, said WHIO-TV meteorologist Rich Wirdzek. He’s anticipating night temperatures in the teens and 20s and day temperatures in the 30s.

DeWine said that his office is actively monitoring complaints. He said he’ll work with other states to look for possible anti-competitive activities related to the sale of propane. A breakdown of complaints forwarded from his office show that since Nov. 2, around 100 complaints have come in.

They’ve included failing to deliver, billing issues, cancellations and price gouging. Complaints locally have come from Troy, New Paris, Oregonia and Celina.

“We want to assure Ohioans that we will carefully monitor reports of potential price gouging or other unfair business practices related to the extreme cold,” Attorney General DeWine said. “We want all Ohioans to be safe during these frigid days. If you use propane to heat your home, be especially careful. Contact your propane supplier before your tank reaches emergency levels and reach out for help as soon as you need it.”

About 6 percent of Ohioans use propane to heat their homes. In some cases, consumers say their propane suppliers are not filling tanks as quickly as normal or that they are charging higher prices, which some consumers believe to be price gouging, DeWine said.

While Ohio does not have a statute that deals directly with price gouging, state law bans unconscionable sales practices.

DeWine said when people contact his office when their tank is 10 percent or less full, a staff member will call the consumer’s propane supplier that day to determine why a fill is being delayed. Consumers who have an inability to pay for their propane fill will be directed to state and local resources for help.

The costs for propane and heating oil fuels have hit record U.S. average prices in the past week, the U.S. Energy Information Administration said. Propane is up $1.05 to $4.01 a gallon and heating oil is up 12 cents to $4.18 a gallon.

In Ohio, the average price for residential propane was $3.73 per gallon, up from $3 the previous week. For heating oil, the residential price rose from $3.68 per gallon to $3.85 per gallon.

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