Insight

Strong Contango Emerges in Propane Market as Supply Glut Drags On

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Report summary

Since the beginning of May, spot propane prices have declined from $0.54/gal to $0.38/gal, with some US Gulf Coast locations trading as low as $0.33/gal. Weak global demand for US exported LPG combined with a tight VLGC market have helped , the Mont Belvieu propane futures curve has recently moved into steep contango between the June 2015 and February 2016 contracts of ($0.11/gal). Such a deep contango indicates that the market is concerned with oversupply. 

What's included

This report contains

  • Document

    Strong Contango Emerges in Propane Market as Supply Glut Drags On

    PDF 390.75 KB

Table of contents

  • Stubborn Production and Disappointing LPG Exports
  • US Propane Seeking Domestic Petchem Solvers and Possibly Fuel Demand
  • Can US Petrochemical Market Solve a Propane Supply Glut?

Tables and charts

This report includes 5 images and tables including:

Images

  • US Waterborne LPG Exports and Terminal Capacity
  • Propane Freight Rates From USGC to Europe and Japan
  • United States Ethylene Cash Costs
  • LPG Volumes at the Flexible Steam Cracker
  • US Propylene Nonfuel Use Stocks at Bulk Terminals

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