Canadian LPG Stocks – Tilting Back to Tighter Levels

Western Canada’s propane inventories at the end of September (red line and text in left hand chart below) were posted at 7.0 MMbbl, with a seasonal average build of 0.1 MMbbl versus August and stand 0.9 MMbbl (-11%) below the five-year average (blue line) according to data from the Canada Energy Regulator (CER). The near unchanged performance in the month appears to be a combination of moderately lower propane production in Western Canada as some natural gas output was shut-in due to extremely weak natural gas prices for part of the month, leading to lower fractionated volumes of propane, as well as robust exports from Canada’s West Coast. Weather appears not to have been an issue in September as Western Canada recorded its lowest population weighted heating degree days (a measure of how cold was the weather) since 1900.