Midwest Spots Plunge, Mont Belvieu Climbs

With a more restrained winter draw of 0.8 MMbbl reported for the nation by the Energy Information Administration the last week of Janu­ary, and an actual build of that same amount in the Midwest, fears seemed to have been calmed somewhat of the calamity of draining the Heartland dry before the end of the heating season. Once again the markets reacted immediately and decisively and spot propane at Conway, Kan. Thursday had given up 24 cents of its value compared to Monday trading, this after tumbling from the 500.00-cent gas that had the markets panicking.

Mean­while, Gulf Coast inventory volumes dropped another 1 MMbbl over the same period, and spot propane was up another 3.125 cents to a nickel at Mont Belvieu Thursday from early in the week. With the steep drop at Conway and with Belvieu edging higher, Conway’s premium to the Texas trading hub narrowed markedly to the 19.75- to 22-cent range, this as the industry responded aggressively to move barrels into the Midwest to allevi­ate the critical inventory shortfall.

Group 140 (Conway) bids and offers mid-morning Thursday were at 178.00-182.00 cents/gal., down a hefty 24 cents for buyers and 33 cents for sellers compared to Monday activity. One deal had been reported done at 178.00 cents as of press time.

            At the same time, Mont Belvieu non-LST spots stood at 156.00-157.00 cents/gal., higher by 3.125 cents for buyers and 3.5 cents for sellers over the week. Low and high trades were posted at 157.875 and 158.00 cents. LST spots, 2.25 cents higher at 158.25-159.00 cents/gal., jumped a nickel for buyers and sellers from Monday. Low and high trades as of mid-morning were at 159.00 and 160.25 cents.

Although no trades were reported as of press time, Hattiesburg spot propane nonetheless was also trading considerably lower for the week. Bids and offers in that market had fallen off a sharp 22.5 cents for buyers and 30 cents for sellers to stand at 262.50-275.00 cents/gal.

With Canada experiencing its own logistics and field-side inven­tory night sweats this winter, spot propane at Edmonton and Sarnia gained appreciably over the week. Edmonton spots Thursday were at 272.00-301.25 cents/gal., up 14.5 cents for buyers and 29.25 cents for sellers. Sarnia propane was trading at 257.75-258.00 cents/gal., gaining 5.75 cents for buyers and a dime for sellers from Monday.