There was a modest draw in propane inventories this week, 1.7MM in all with 1.5MM of the draw down being in the Midwest. There was a 100K build in the Gulf this week, but I think that could be due to some gas being shuffled in to the region.
Prices in the Midwest jumped up right away and prices remain firm in the Southeast. I can also tell you that people are locking in gas at over $2.30/gallon in the Northeast. Now, margins in that part of the country are among the best in the industry, but gas is really tight up there. The TEPPCO pipeline continues to let people down and it’s a logistical quagmire. In October, I brought up a scenario where the econs would get tough enough in the Northeast where we might see trucks heading to Apex, NC to lift loads and taking them back to the Northeast; that’s starting to happen.
We’re now at 16.9MM of inventory in the Midwest…spooky time.
CRUDE PART II: I sent out a link this morning related to Crude Bulls…I am not trying to be confusing here or talk out of both sides of my mouth, but I also want you to know that I am not going to hen peck what I share…I came across this link related to crude oil and the builds we had in MoGas and distillates pointing to ramped up refining capacity and the product not being absorbed in the consumer market. That said, the bullish tone of the article I sent earlier was more focused on the 2014 economy.