Propane price pushes past previous benchmarks
July 28, 2020 By Mark Rachal
As fate would have it, propane pushed above 50.2 percent of WTI crude and 48 cents over the past week.
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As fate would have it, propane pushed above 50.2 percent of WTI crude and 48 cents over the past week.
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Crude demand is expected to decline 8 percent this year, increase 6 percent next year and fully recover in 2022.
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U.S. propane production has been on the rise over the past few weeks, putting a lid on propane…
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Over the past five weeks, propane production has been down. Mark Rachal takes a look at the scoreboard for U.S. propane inventory levels compared to prices.
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Propane industry leaders are beginning to take notice and consider what recent market dynamics might mean for propane supply this winter.
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Propane’s more supportive fundamental picture will keep it from falling to the extremely low values witnessed at the beginning of the year.
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Propane is trading at a record high relative value to WTI crude, which suggests traders see propane fundamentals as more supportive of its price.
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The oversupply in crude is leading to reduced propane supply, which is causing the value of the two commodities to separate.
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Under the current situation where crude is oversupplied on a global basis, U.S. propane supply fundamentals are becoming more price-supportive.
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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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