The Westlark Team
At Westlark, our team of energy advisors has a depth of knowledge and experience in the energy industry. This translates into measurable savings and skilled guidance for our clients.
As a team, we are committed to providing honest and transparent commodity advice our clients trust. We don’t just work for you; we work with you, driven by your vision and guided by your goals.
Allan Degenhardt: Thoughts on the Current Market
In April 2025, Allan Degenhardt joined the Westlark Advisors Team. Allan brings over 20 years’ experience in the propane industry to his role as a Senior Commodity Advisor. An excellent communicator, he has built relationships with clients across the United States. His extensive experience in tracking market trends gives him the skills to help clients navigate challenging situations and reach their unique business goals.
Considering his experience in the propane/fuel industry, we asked Allan to share his thoughts on what is going on in the market right now.
Allan’s Thoughts
In the energy market right now, we are monitoring several items. Some of the more important factors currently impacting the energy market include:
- Geopolitical events
- The Fundamentals
Geopolitical Events
Geopolitical events are really moving the market right now. For example, last week the market opened “bearish” because Iran agreed to negotiations with the United States. Then, later in the week, the meetings were unexpectedly cancelled, which instantly sent the market back “up.”
These meetings were important because Iran, along with other nations in the Middle East, produces large quantities of crude oil. Any unexpected surprises in the Middle East will likely cause disruption to other energy markets. On Friday, February 6, 2026, the U.S. and Iran held “indirect” talks in Oman, which ended on a cautiously optimistic note. This situation is still developing, and it is one of the major events we are watching.
Other geopolitical factors influencing the energy markets currently are the situation in Venezuela and the war between Russia and Ukraine. These situations can affect market-based pricing and are issues we are watching.
The Fundamentals
Other issues that are moving the market right now are basic fundamentals. These are the trends that we, as energy professionals, are very familiar with.
Over the past several weeks much of the Eastern United States has been extremely cold. Recent severe cold weather in the U.S. has increased the demand for fuel. In last week’s EIA Inventory Report, production was down due to the severe weather events; however, overall inventory remains at record high levels.
For the week-ending January 30, 2026, the U.S. propane levels were at 82.7 million barrels. Compare that with the same week in 2025, when the U.S. had 64 million barrels of propane. Despite the additional demands for fuel due to recent severe weather, the inventory might not drop as far as people anticipate.
Why is that?
One possible reason is export issues. The U.S. has been exporting roughly 1.8-2.2 million bpd of propane, although we expect this number could slow down soon. The reason for this is due to current issues at the facility, which will lessen the amount exported. Another possible reason is the sheer amount of inventory on hand. The demands on the inventory we have now may not be enough to take the supply down as much as suppliers and customers would think.
Additionally, in the next few weeks, the “drawing down” of current inventory could level out, meaning inventory could remain higher than expected for this time of year. Whenever you have a lot of inventory, it could place a cap on what pricing can do long-term. This situation could potentially affect future pricing.
Conclusion: What should you do?
Looking at the market right now, there are a lot of unknowns. Allan’s advice on next steps is this.
“I would advise to simply stick with the basics. If you have the product sold, then you should cover it. Go ahead – buy your product and secure your margin.”
Clients who have not already sold their product, can use the “layering in” strategy. This strategy involves making multiple smaller purchases to meet your estimated need, rather than one large purchase.
Allan is a big fan of this strategy, stating:
“If you purchase on pricing dips throughout the year in smaller layers, you could gain a solid overall weighted average.”
One last word of advice from Allan to all energy professionals:
“No matter what, don’t try to out-guess the market. With current news headlines at all of our fingertips, pricing can and will change at a moment’s notice.”
