Midwest Propane Stocks Hit 8-Year Autumn Low
September 30, 2021
The DOE report on inventory had crude stocks up 4.58 million barrels putting total stocks at 418.542 and last year there were 492.426 million barrels a difference of 73.884 million barrels. US production was up 500,000 BPD to a total of 11.100 million BPD.
Cushing crude stocks were up 131,000 barrels to a total of 33.971 million barrels and last year at this time there were 56.066 million a difference of 22.095 million barrels.
Gasoline stock was up 193,000 barrels to a total of 221.809 million barrels and last year at this time there were 228.182 million barrels a 6.373 million difference. Implied demand was up 606,000 BPD to a total of 10.124 million BPD.
Distillate stocks were down 384,000 barrels to a total of 129.727 million barrels and last year at this time there were 172.758 million a difference of 43.031 million. RBOB and ULSD supplies are on the low end of their ranges and with demand steady, it has pushed prices to these high levels. The outlook continues to be good for demand, but if prices continue to the upside they will be at the point where could be some demand destruction. The market has a lot of bullish news right now and the continuing theme of low supplies and good demand has continued to push markets higher and this week’s inventory report didn’t change that narrative. But there are starting to be some cracks in the bullish outlook. Some of these issues are the electricity crisis in China, petrol outages in the UK (driver shortage), inflation is seen as more long-term, Evergrande, etc. These things could add some selling pressure to prices if they continue to progress badly, but the current near-term trend is still higher. Energy prices like propane may need to go higher still to try and price in less demand to slow the price increase. The old adage that the cure for high prices is high prices may need to come to pass to end the current uptrend.
The propane inventory report had a build to stocks of 2.642 million barrels putting total stocks at 72.921 million barrels and last year at this time there were 101.959 million barrels a difference of 29.038. Total propane stocks are low, lower than they have been this time of year at any time during the “shale era”. (Last 8 – 10 years)
Midwest stocks were up 433,000 barrels putting total stocks at 24.993 million barrels and last year at this time there were 27.832 million barrels a difference of 2.839 million barrels. Midwest stocks are also at the lowest point for this time of year in the last 8 years. A very concerning fact and the reason we continue to say get your tank filled up now and keep it full.
Gulf Coast stocks were up 1.443 million barrels putting total Gulf Coast stocks at 33.787 million barrels and last year at this time there were 59.539 million barrels. Gulf stocks are also very low for this time of year and not comforting as we are headed into winter.