US propane stocks rise by 1.3mn bl: EIA

OREANDA-NEWS. US propane inventories rose by 1.3mn bl to 81.96mn bl for the week ended June 19, according to the Energy Information Administration (EIA).

US propane reserves are now 816,000bl higher than the 2014 peak, 28.29mn bl higher than last year's stocks for the third week of June and 41.65pc above the five-year average.

Inventory builds were smaller week-on-week in all regions despite expected infrastructure disruptions by the tropical storm that hit the Gulf coast 16 June. Market observers had expected a larger 2.2mn bl increase according to an Argus survey.

Inventory volumes in PADD III entered record territory in early May, and have since grown an additional 7.2mn bl, sparking daily market discussion of storage concerns in the region. Gulf coast stocks grew by 742,000bl to 51.9mn bl last week.

Export observers reported that loadings and outgoing vessel traffic were overall unaffected by the two-and-one-half day closure of the Houston Ship Channel last week, with several vessels departing over the weekend.

Spot propane prices at Mont Belvieu, Texas, firmed following the release of the EIA's data.

LST propane opened the session valued at 38.5/USG and rose to a high of 41/USG following the release of the inventory report. It declined to 39.5/USG in trade following.

EPC propane also rose, to 37.75/USG, up from its opening value of 35.25/USG.

Midcontinent inventories grew by 537,000bl last week, reaching a total of 22.1mn bl. Reserves in the PADD II region are now roughly equal to levels seen at the end of last July. The smaller week-on-week build could have been caused in part by ongoing refinery turnarounds in the Chicago area.

Spot markets activity at Conway, Kansas, was thin after the data release. Conway propane's price moved choppily midmorning at 32.5-33.25/USG.

Many Conway traders were glad to see a smaller regional build, though oversupply concerns continue to dominate market discussion.

Stocks along the east coast remained close to 5mn bl, only rising by 19,000bl week-on-week.

In the west coast and in the rocky mountain region, inventories grew by 10,000bl to 2.79mn bl. One vessel departed from the Ferndale export terminal in Washington last week, but these volumes were sourced from Canada.

US propylene stocks fell by 100,000bl last week amid splitter maintenance at Enterprise Product Partners' Mont Belvieu complex. Product supplied to end-users fell by 109,000bl to 928,000bl.