At Westlark Advisors, we are passionate about sharing our extensive market expertise. With this in mind, we are excited to launch a new blog series called: Q & A with the Westlark Team. Our goal in this series is to answer some of the questions on the minds of energy industry professionals today.
We begin our series by sitting down with Team Member, Allan Degenhardt, Senior Commodity Advisor.
The top three market factors currently impacting propane prices are:
News updates about critical world events have always influenced commodity markets, but today these exchanges seem almost hypersensitive to any news or announcements, especially those by world leaders. In the past, an extreme week for crude oil might show a $5 – $7 movement. Now, crude oil can easily move $10, either way, in one day.
The market is very reactive at this moment. We are seeing big fluctuations almost daily. For example, I’ve seen crude oil move $4 while I have been on a ten-minute phone call. These fluctuations demonstrate the volatility of the current market.
However, propane has not experienced the same type of market volatility as crude oil. The main reason for this is a fundamentals issue – we have a record amount of propane in storage for this timeframe. Right now, the U.S. has 80 million barrels of propane in storage. In comparison, at the same time in 2025, the U.S. had only 46.6 million barrels stored, although we did top out at 101.6 million barrels last year.
Having this amount of propane supply in reserve has been a big factor in keeping propane prices relatively stable. If the U.S. had a significantly smaller amount of propane stored at this time, then we might be seeing a larger variance in pricing.
I think there is a lot of uncertainty right now about the unknowns in world events. For example, it’s not clear how long the U.S.-Israel-Iran war will last, when there will be a ceasefire or resolution. There are also numerous concerns about the Strait of Hormuz. Not to mention, the over four-year conflict between Ukraine and Russia.
The Strait of Hormuz is absolutely vital to global energy, and it has been closed for several weeks. We are at a point where its closure has created a type of “ripple effect” of negative impacts throughout global energy markets.
Producers that have ships trapped in or blocked from transit through the Strait have found their storage facilities at capacity. This has already led to cuts in production. These decisions will affect the markets through shortages along with further price increases. This will likely take years to resolve.
This year it is more important than ever to “layer in” supply. Some distributors have probably already started making smaller purchases of product when they see a lower price. For those that have not begun to purchase their supply yet, I would advise them to start watching for “dips,” or short drops in price.
Purchasing product on a dip can be an effective way to get some of your supply secured at a lower price. However, recently, these price drops have been very short term, often lasting only hours. Because of these rapid changes, we are watching the markets very closely and offering advice to our clients on a day-by-day basis.
Currently, we’re in a backwardation situation with propane, which means there are some good values available. Using these opportunities to purchase 15%-20% of your supply for 2028, 2029, and even 2030 could put your business in a good position for the future when the current higher prices and potential shortages are resolved.
One of the things I like most about my job is the fact that it forces me to keep up with world events. To understand what is happening in the energy markets, I need to know and study what is happening in the world. This has pushed me to develop research and analysis skills that allow me search out and evaluate news sources. In the process, I have discovered a real passion for updating my knowledge of global events.
However, the best thing about my job – and about the propane industry as a whole – is the people. I’ve been in this industry for over twenty-two years and have made a lot of solid friends. Building strong relationships both inside and out of a business setting is my favorite part of the propane industry. I feel very blessed to be able to work alongside many of my clients and friends.
By Allan Degenhardt
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Westlark Advisors has taken the burden of the everyday supply logistics off our plate and allowed us to focus on our operations in the critical times of the year. They have educated our team along the way and helped us brainstorm options/risks that fit our business model. Westlark Advisors has allowed the Tevis organization to explore opportunities within the supply and hedging arena that we would not have been exposed to without the relationship.
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They not only taught us how to plan and diversify our supply, but also new ways to protect the price. They have been great at negotiating supply deals and putting plans in place to know we will be secure when the market is not. I am confident that if things get tight we will be in a better position than our competitors.
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Westlark Advisors has partnered with energy firms since 1998 to provide transparent, value-driven commodity market advisory services.
International Market Highlight – April 30, 2026