Propane Draws 3M/bbls

REGIONAL INVENTORY LEVELS

NATIONAL INVENTORY DATA

This week’s EIA report showed a 3M/bbl draw, which is far less than last week’s outlier of 6.2M/bbls, which we believe was the fourth-largest weekly draw in history.
National inventories now stand at 74.3M/bbls, or 19.7M/bbls over last year at this time. With six more reporting weeks to go, we may dip below the all-time record high end of March inventory level of 62.8M/bbls which was set in 2016. We would need to average 1.92M/bbls worth of draws over the next six weeks to get just below 62.8M/bbls. It may be close.
Propane values have been strong this week, as crude oil has also seen a run up in value as economic fears relative to the coronavirus have eased…at least in the minds of the traders. Values for propane futures took a sharp jump in the past 24 hours, too.
LAST FOUR YEAR INVENTORY COMPARISON
KEY PROPANE PRICE INDICATORS SINCE JANUARY 1
REPEAT OF 2019 WET SPRING?
The image on top is the drought monitor for one year ago yesterday (February 18th, 2019)…you can see areas of Iowa and Wisconsin, southern Ohio and Nebraska that had above normal soil moisture levels. The image below it is the drought monitor for this year, as of February 17th, 2020. You can see that Nebraska, South Dakota, Iowa and a good chunk of Wisconsin are well above normal moisture levels. Most all of the corn belt is either slightly above normal or significantly above normal, with very few areas shaded in white which would be normal. NONE of the corn belt is below normal.
The following image shows BAMWx.com’s preliminary precipitation forecast for May of 2020…