Mont Belvieu, Conway Posts Move Lower

The spot markets picked up where they left off prior to the holidays and continued to move even lower Thursday, Jan. 8. Mont Belvieu was down another 1.75 to 2 cents, while Conway shed just a half cent compared to the Monday email Update. Those late-week losses added more bad news for the markets as early-week trading showed even steeper declines of 4.375 cents at Belvieu and 4.5 cents at Conway compared to the previous reporting period. Significantly, Texas propane has dropped well under 50 cents/gal. and the Midwest is now below 40 cents.

If prices do get a bounce it should happen soon as Arctic air has blanketed many regions of the nation, bringing the coldest temperatures posted this winter. A significant inventory draw for the heating season was also recorded the week ended Jan. 2, with the Energy Information Administration reporting that stocks had fallen 1.6 MMbbl. However, the entire global energy complex remains in the doldrums as crude supply outstrips demand worldwide, with no sign OPEC and other producers are headed for a near-term correction to cut production to bolster prices. Meanwhile, the U.S. benchmark crude, West Texas Intermediate (WTI), has dropped under $50/bbl.

Mont Belvieu non-LST propane mid-morning Tuesday was trading at 44.25-44.875 cents/gal., off 1.75 cents for buyers and 1.625 cents for sellers from Monday. Low and high deals done as of press time were reported at 43.625 and 44.625 cents. LST spots stood at 44.50-45.25 cents/gal., lower by 2 cents for buyers and 1.75 cents for sellers, with low and high trades at 44.25 and 45.50 cents.

The Group 140 (Conway) bid and offer mid-morning was at 39.25-40.25 cents/gal., with the bid shedding a half cent and the offer paring 1.25 cents between the two reporting periods. Low and high deals were posted at 39.00 and 40.25 cents.

The Canadian spot markets were deeper in negative territory at week’s end. Edmonton spots, at an astounding 10.25-16.50 cents/gal. Thursday, dropped 6.25 cents for buyers and a half cent for sellers from Monday. In the past month alone, that market has plummeted nearly 25 cents. Sarnia propane, at 68.50-70.00 cents/gal., was down a nickel for buyers and 4 cents for sellers for the week.

Elsewhere, crude oil futures on NYMEX Thursday reversed a four-session losing streak to rise 50 cents, or 1%, to $49.10/bbl. Market watchers noted that the commodity gained some temporary traction from a larger-than-expected weekly inventory draw, but that they expected WTI trading to remain volatile in coming weeks.