The price of propane gas explained

The price of propane gas depends on several factors. These are production costs, transportation costs, government levies on suppliers, taxes on consumers, and market supply and demand. Below we explore these factors in more detail.

• Production costs: The costs of extracting, producing and refining propane gas are the fundamental elements that determine the price. We strive to keep these costs as low as possible without sacrificing quality.
• Taxes: Like all other products, the government levies taxes on products consumers buy.
• Transportation costs: The distance between the production facilities and the delivery location can affect the price of propane gas. At OK GAS, we constantly optimize our logistics processes to minimize transportation costs.
• Market demand and supply: External market factors such as propane gas supply and demand also play a role in pricing. Consider the demand for natural gas and government policies related to sustainability.
• Government levies: These are both excise and stock taxes. The chart below shows how excise taxes have evolved in recent years.

You can find the exact cost per 1,000 kg on the tax authorities' website.

Since July 1, 2023, as a propane supplier, we have been paying €344.74 in excise tax per 1,000 kilograms of liquefied petroleum gas (propane). In addition, we also pay €8 per 1,000 kilograms in stock tax. Together, this amounts to €352.74, excluding 21% VAT, per 100 liters. As a supplier, we therefore pay the government (converted) €0.1799 per liter, excluding VAT, in taxes.

As a supplier, we refill our customers’ tanks by the liter. For a propane refill of, say, 1,000 liters, you’ll pay 1,000 × €0.1799 = €179.90 in excise taxes and inventory levies.

As a propane supplier, we expect propane prices to remain stable. This is because supply and demand are more stable. This is entirely due to the price of natural gas. Although geopolitical tensions persist in both Ukraine and Israel, we expect natural gas prices to remain stable.

The Netherlands has had a year to build up its natural gas reserves. This will allow it to continue supplying Dutch households with natural gas this winter.