Propane inventory gets much-needed build
August 2, 2022 By Mark Rachal
Mark Rachal, director of research and publications with Cost Management Solutions, discusses the latest propane inventory builds.
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Mark Rachal, director of research and publications with Cost Management Solutions, discusses the latest propane inventory builds.
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Trader’s Corner, a weekly partnership with Cost Management Solutions, analyzes propane supply and pricing trends. This week, Mark Rachal, director of research and publications, explains why gasoline demand will influence the price of crude.
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Tom Jaenicke suggests propane retailers let their customers know that they share the pain of higher energy prices caused by inflation.
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Along with tighter propane fundamental trends, crude trends point toward a higher price environment ahead, says Mark Rachal of Cost Management Solutions.
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Normally, there is a fairly close correlation between the price direction of propane and crude, but sometimes they…
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Developments in crude production and pricing should be watched carefully to see how that translates to propane production and pricing leading up to winter.
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As citizens sheltered in place, there was a dramatic shift in crude demand, leading to an extreme oversupply that has most available crude storage nearing capacity.
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In addition to crude’s collapse, Rachal discusses the propane pricing and supply environment. COVID-19 will have a greater impact on propane supply than it will on propane demand, he says.
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While Saudi Arabia has called an emergency meeting of OPEC+, there is little doubt that U.S. production growth is very likely to slow in the future.
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The price of crude has rebounded a little since, but the potential for it to go lower is still present due to demand destruction from COVID-19 and producers not cooperating to limit production.
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