Price spread between Mont Belvieu, Conway balloons
February 26, 2018 By Mark Rachal and Dale Delay
As the impacts of winter demand wane this time of year, it is not unusual to see Conway prices move toward the weak side.
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As the impacts of winter demand wane this time of year, it is not unusual to see Conway prices move toward the weak side.
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There have been two primary factors behind the late-winter weakness in propane prices: rising propane production and lower propane exports.
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Cost Management Solutions’ Mark Rachal takes a look at propane’s relative value to crude and how it is trending compared with last year.
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It is now the homestretch for winter, but forecasts for a cold February mean there is much work still to be done.
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U.S. propane prices have returned to where they began the winter – in a price decline that has surprised many, given strong domestic demand support.
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In 2018, ICF expects the retail propane industry to be characterized by transformation and change.
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As a result of higher crude oil prices, colder expected winter temperatures and lower fuel inventories than last winter, the EIA predicts propane prices will remain high through March.
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Propane prices often go through a bit of a slump between the middle of October and the Thanksgiving holiday.
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Relative to West Texas Intermediate’s crude price, Mont Belvieu is valued at 76 percent, while Conway is valued at 73 percent.
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Recently, propane prices have not gone beyond 78 to 80 percent of West Texas Intermediate (WTI) crude’s price.
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