NPGA, IHS Markit report critical inventory levels in February

The National Propane Gas Association, in conjunction with IHS Markit, produces a monthly propane inventory report. In the February report, propane days of disposition reached critical inventory levels of 19.8 and eventually fell below 18 days following elevated levels of exports.

Prices at Mont Belvieu reacted to the fall by increasing from 73 cents per gallon to more than $1 per gallon, according to the report. Higher prices would potentially impact propane export economics. If exports fall based on arbitrage economics, IHS expects these lower exports combined with higher supply – from a recovery in U.S. crude production – to lead to well-stocked inventories and lower prices this spring and summer.