1. Winter Distillate and Propane Outlook Joanne Shore Energy Information Administration State Heating Oil and Propane Program August 2000

2. Distillate Prices Increasing With Crude Oil

3. Distillate Supply/Demand Balance Reflected in Spreads

4. Distillate Stocks are Low – Especially on the East Coast Source: EIA

5. Distillate Stocks Are Important Part of East Coast Winter Supply Source: EIA

6. Warm Winters Held Heating Oil Demand Down While Diesel Grew Source: EIA

7. Distillate Demand Strong in December 1999 Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2000.

8. Dec 1999 & Jan 2000 Production Fell, But Rebounded with Price Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2000.

9. More Supply Possible This Fall than Forecast Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2000.

10. Unusual Net Imports May Only Be Available At A High Price Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2000.

11. Distillate Stocks Expected to Remain Low

12. Winter Crude Oil and Distillate Price Outlook Sources: History: EIA; Projections: Short-Term Energy Outlook, August 2000.

13. Conclusion zDistillate stocks likely to be low going into winter zPrices likely to average as high as last winter even without volatility zResidential customers will need to purchase more fuel this winter if weather is normal zSame price times higher volumes equals higher bills this winter than last

14. Propane Prices Follow Crude Oil Source: S&P DRI Platt’s Spot Prices, EIA Retail

15. Propane Demand is Highly Seasonal, But Fresh Supply is Not Source: EIA

16. Propane Sector Demand Shares Source: 1997 Sales of NGL’s, API

17. U.S. Propane Demand Jan-May Source: EIA

18. U.S. Propane Production by Source Source: EIA

19. Waterborne Imports Fall Source: EIA

20. Exports of Propane High in 2000 Source: EIA

21. U.S. Propane Net Imports Jan-May Source: EIA

22. U.S. Propane Stocks Source: EIA

23. PAD District II Stocks (Midwest) Source: EIA

24. Propane Stocks Are Important Part of Midwest Winter Supply Source: EIA

25. Conclusion zPropane inventories are expected to begin the heating season somewhat low -- especially in the Midwest zPropane supply likely to remain above prior year yhigh co-production of propane as refineries continue to meet strong petroleum demand yhigh gas plant production of propane as surging crude oil prices keep gas plant margins in positive territory. zHowever, propane exports and demand also may be high yhigher U.S. exports of propane are uncertain yResidential heating demand likely to increase if weather returns to normal following warm weather during the past two winters. zConsumers will continue to pay more due to higher world oil prices