National propane reserves are at their lowest pre-heating season levels since 1996.
Figures released yesterday by the US Energy Department show US propane inventories added 1.2 million barrels in the week to September 30.
Total reserve stocks now stand at 57.5 million barrels – the equivalent of 60.4 days’ supply. At the same time 12 months ago there were 64 million barrels in storage – the equivalent of 60.7 days’ supply at last year’s consumption rates.
This week marks the official start of the traditional winter heating season, which runs from October through March. But the Energy Information Administration says current inventories are their lowest pre heating season levels in 15 years.
Though stocks posted a modest gain last week and have now increased for 23 of the last 24 weeks, they are still tracking below the traditional average for this time of year.
As reported previously on Propane.pro, it’s normal for propane inventories to grow in the spring and summer months when warmer weather means less demand for propane gas to fuel home heating burners. But strong overseas demand for US propane and cool spring conditions earlier this year have put pressure on spare capacity and seen reserves struggle to post significant off-season recoveries.
The relatively low current reserve stocks could have ramifications for heating season propane prices, particularly if there are disruptions to domestic supply.
Last week’s increases were led by the Gulf Coast region, which posted an 800,000 barrel build. East Coast stocks grew by 400,000 barrels while the Midwest and Rocky Mountain/West Coast regional inventories each posted slight increases.
Propylene non-fuel use inventories represented 5.8 percent of total propane inventories