Tariffs Going Into Winter 2018

Tariffs Going Into Winter 2018

China rolled out retaliatory tariffs on an additional 16 billion worth of U.S. imports in early August, including oil producers, LPG, and coal in a new list of affected goods. At the same time, a 25% tariff on China’s imports of American LPG probably won’t change the picture for inventory of propane.  US propane wholesalers see the tariffs as a short-term obstacle to the export of propane, and with long term contracts already negotiated these tariffs may not go into effect till next winter.

US exports continue to remain high to Asia. The primary reason behind the high exports are tepid Middle East exports to Asia and high naphtha to propane spreads incentivizing PDH economics in China. The high exports have stalled the required growth in inventory necessary to replenish inventory in the US to safe days of disposition.

The National Weather Service is predicting a 70% chance of an El Nino weather pattern for this winter.  This usually means a warmer but very wet winter with not as much snow in the mountains.  We have had some cold El Nino years where we had quite a bit of snow on the valley floor.  This happened back in 1996 where we had a week of snow and then a week of heavy rain which caused wide spread flooding in the Portland metro area.

We are starting our winter routing on October 1, so you should be seeing the big blue delivery truck filling up your tank soon.  If you are a will call customer this would be a good time for us to stop by and fill your tank without any special trip charges.  If your tank is getting low then please call in and we will try and get you a fill as soon as possible.

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