Again, A Reader Is Ahead Of The Buzz -- Propane -- August 12, 2021

This is pretty cool. This from RBN Energy today:

RBN Energy: propane exports continue to pull US inventories lower.

The EIA report on propane inventories that came out yesterday was a shocker. This time of year, stocks are supposed to be building toward the levels needed to get U.S. propane markets through the winter season. But the numbers released on Wednesday showed an inventory decline, resulting in inventory balances now below the five-year minimum.

The culprit, of course, is exports, with 1.4 MMb/d of them reported last week, a 17% gain over the year-to-date average. And these cargoes to overseas markets are happening even with propane prices in the stratosphere: more than double where they stood this time last year.

Propane marketers were hoping that higher prices would slow down exports, but so far that is not happening. In today’s blog, we examine U.S. exports of LPG — propane plus butane — and discuss what may be ahead for these markets.

From a reader a few days ago:

There has been SO much hydrocarbon info coming out these past several days, one has a difficult time keeping up.

One of the odder data points came from Energy Transfer's conference call when the CEO said a Memorandum Of Understanding has been reached with the government of Panama to study the feasibility of building propane terminals on either coast of Panama and a pipeline to connect them.

To say I was taken aback would be an understatement, but the more I pondered the current and future scenarios, it actually may make a lot of sense.

Condensed 'story' ...

There are now small fleets of HUGE ships csrrying propane (LPG) non stop to new, HUGE petchem  plants in China and India. 

This is in addition to the robust push for  expanded heating/cooking applications to propane from wood, coal, etc. 

These big ships (using onboard propane for fuel) can 'zip' back and forth reliably from a west coast terminal. 

The LPG can, somewhat, be economically ferried down to the  east coast of Panama from Texas terminals using older, smaller ships that are  increasingly becoming obsolete for longer voyages.

Amazing example of global ripple effect that has its origins in the free market economy and adventurous risk takers like Harold, et al.