Propane inventories fell again last week but the average residential price climbed slightly on higher winter heating season use.
Figures released yesterday by the US Energy Information Administration show national propane reserves fell by 200,000 barrels –third consecutive weekly draw.
There are now 59.4 million barrels in storage – the equivalent of 51.6 days’ supply. In contrast there were 64.2 million barrels in storage 12 months ago – the equivalent of 61.7 days’ supply at last year’s consumption rates.
Propane stocks had been building steadily during the summer and autumn months, but winter heating demand is starting to take effect as the weather cools. Strong overseas demand for propane from nations such as China and India has left reserve inventories tracking well be last year’s levels.
Last week’s draw was led by the Gulf Coast region, where inventories fell 400,000 barrels. Gulf Coast reserves are significantly below typical levels for this time of year. But the Midwest regional stocks posted a 200,000 barrel build, while the East Coast and Rocky Mountain/West Coast regional inventories both fell slightly.
Propylene non-fuel use inventories, which are used to manufacture plastics, accounted for 7 percent of total propane reserves, a figure that has been trending up in recent weeks.
Meanwhile, the average residential propane price increased 1 cent a gallon in the last week. Average prices are now 28 cents higher than they were 12 months ago. Prices increased across all regions.
The data is compiled weekly by the EIA for its State Heating Oil and Propane Program (SHOPP), which measures heating oil and propane prices across 24 states during the October to March heating season.
The EIA predicts average residential propane prices will be 7 percent higher this heating season than they were last winter.