Spots Advance by Fractions, Crude Oil Gets Bounce
Propane trading edged higher Thursday during a week when oil first fell into a bear market, then jumped sharply higher after a big drop in gasoline inventories. Propane spot prices at the Mont Belvieu markets gained a quarter cent and 0.375 cents compared to the Monday email Update, while deals in the Group (Conway, Kan.) also advanced three eights of a cent. Early-week trading also saw small moves for propane pricing, with bids and offers both advancing and retreating compared to the previous report. Crude futures late in the week were struggling to build on data released Wednesday that showed an unexpected decline in U.S. gasoline stocks, which contributed to crude oil moving higher. However, crude, the leading energy commodity, remained under pressure as traders eyed the long-standing global glut of supply, lower demand, and a gloomy outlook for the worldwide economy.
Mont Belvieu non-LST propane mid-morning Thursday was trading at 41.875-42.00 cents/gal., higher by 0.375 cents for buyers and 0.125 cents for sellers compared to Monday. Low and high deals as of press time were posted at 41.875 and 42.375 cents, with the last trade done at 42.00 cents. LST spots, at 42.375-42.50 cents/gal., were up a quarter cent for buyers but off 0.25 cents for sellers, narrowing the bid and offer. Low and high trades were reported at 42.50 and 43.00 cents, with the last deal done at 42.75 cents.
The Group 140 (Conway) bid and offer were at 35.875-36.50 cents/gal. for a gain of 0.375 cents for buyers but a loss of a quarter cent for sellers compared to Monday trading. Low and high deals as of mid-morning Thursday were on the board at that same 35.875 and 36.50 cents, with the last trade at 36.50 cents.
Elsewhere, September West Texas Intermediate crude oil on NYMEX declined a sharp 26 cents, or 0.7%, Thursday to settle at $40.57/bbl after moving between moderate gains and losses a day after bouncing back from under $40/bbl. October Brent crude on London’s ICE Futures exchange fell 45 cents, or 1%, to $42.65/bbl after rallying $1.30, or 3.1%, to $43.10/bbl on Wednesday. Oil futures ended steeply higher midweek after the Energy Information Administration (EIA) reported U.S. gasoline stocks dropped a larger-than-expected 3.3 MMbbl. Prices were also buoyed by a 1.1-MMbbl draw on crude stocks at Cushing, Okla., although overall U.S. inventories grew by 1.4 MMbbl the week ended July 29, as reported by EIA.
Mont Belvieu non-LST propane mid-morning Thursday was trading at 41.875-42.00 cents/gal., higher by 0.375 cents for buyers and 0.125 cents for sellers compared to Monday. Low and high deals as of press time were posted at 41.875 and 42.375 cents, with the last trade done at 42.00 cents. LST spots, at 42.375-42.50 cents/gal., were up a quarter cent for buyers but off 0.25 cents for sellers, narrowing the bid and offer. Low and high trades were reported at 42.50 and 43.00 cents, with the last deal done at 42.75 cents.
The Group 140 (Conway) bid and offer were at 35.875-36.50 cents/gal. for a gain of 0.375 cents for buyers but a loss of a quarter cent for sellers compared to Monday trading. Low and high deals as of mid-morning Thursday were on the board at that same 35.875 and 36.50 cents, with the last trade at 36.50 cents.
Elsewhere, September West Texas Intermediate crude oil on NYMEX declined a sharp 26 cents, or 0.7%, Thursday to settle at $40.57/bbl after moving between moderate gains and losses a day after bouncing back from under $40/bbl. October Brent crude on London’s ICE Futures exchange fell 45 cents, or 1%, to $42.65/bbl after rallying $1.30, or 3.1%, to $43.10/bbl on Wednesday. Oil futures ended steeply higher midweek after the Energy Information Administration (EIA) reported U.S. gasoline stocks dropped a larger-than-expected 3.3 MMbbl. Prices were also buoyed by a 1.1-MMbbl draw on crude stocks at Cushing, Okla., although overall U.S. inventories grew by 1.4 MMbbl the week ended July 29, as reported by EIA.
Market watchers noted late in the week that there is gaping oversupply of energy products on the global market, and that includes propane. The trade publication Maritime Executive reports that LPG imports to Asia have left that region awash in product. At least four very large gas carriers were said to be floating in waters off Singapore in late July, with some expected to remain at anchor through September. There are options for LPG ships to be used as floating storage, at an average cost of $16,000 a day, with LPG likely to be stored around Singapore.
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