Over the past 18 months, Gulf Coast dock capacity capable of handling either LPG or ethane has grown significantly. It’s something relatively new called “flex capacity,” and it’s a darned good thing it’s online. Without it, both LPG and ethane export capacity would already be maxed out.
U.S. propane production has trended lower since early May, while the margin above the previous five-year maximum for inventories has continued to narrow despite another inventory build.
The U.S. ethane-to-Henry Hub ratio climbed for a third straight month in July, averaging 111% so far and remaining modestly above the same month last year.
Although the emergency Jones Act waiver issued in March 2026 generated considerable attention, it has had minimal impact on the U.S. LPG/propane market. Based on MARAD voyage reports, only three propane cargoes moved under the waiver, totaling approximately 540 Mbbl.
U.S. propane inventories posted a counter-seasonal draw during the week ended July 3, well below industry expectations. The decline was centered in PADD 3, where inventories recorded their largest same-week draw.
U.S. propane inventories posted a smaller-than-expected build, but stocks remain well above seasonal levels. Production also remains elevated, although it has eased from earlier June highs—a trend worth watching as the summer inventory build continues.
The normal butane market in Mont Belvieu has been particularly volatile this year, rallying at the onset of the Iran war, retreating, then spiking again in mid-May before steadily easing over the following weeks.
U.S. propane inventories continued their seasonal climb last week, reaching 90 MMbbl—24% above year-ago levels and 13% above the previous 5-year maximum. Meanwhile, U.S. propane exports remained elevated at 2.03 MMb/d, above both recent averages and 2025 levels.
U.S. LNG feedgas demand continued to climb last week, driven by higher intake at Corpus Christi, Freeport, and Golden Pass.
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