Energy markets balance — eventually. In the midst of the turmoil we’ve experienced this year, there have been periods when it seemed like markets were going to hit the wall. But even with the historic WTI oil price glitch on April 20, the physical crude oil markets continued to function. That’s the way it is supposed to work, and it’s good news. The bad news is that figuring out how these markets are balancing in these volatile conditions can be challenging if not downright perplexing. Nowhere is that more true than the market for U.S. propane. Production is down, but so is demand. Inventories are up, and so are prices. Propane continues to be exported, even though global demand has been whacked by COVID. In today’s blog, we explore these developments and put the spotlight on RBN’s NGL Voyager, our subscriber report and data service that we have just reformatted, upgraded and generally reconstructed to meet the information needs of today’s NGL marketplace.
We’ve been worrying about the propane markets on a regular basis since the COVID-related downturn hit, most recently in Can't Get Enough of It, where we explored the decline in liquids-rich, associated gas production from crude-focused plays, which has translated directly into a lower volume of NGLs produced — thus reducing propane supplies. That, along with chaos in the crude markets, contributed to a memorable price aberration: during the last two weeks of April, a barrel of propane in Mont Belvieu was more expensive than a barrel of WTI crude oil in Cushing. Propane prices have continued to be very strong relative to other energy commodities, especially crude. And finally, we considered the risks to the propane supply chain if supplies stay tight and we get an especially cold winter in the 2020-21 season.
Visualize the infrastructure behind U.S. NGL movement.
The U.S. NGLs Map provides a comprehensive view of the transport, processing, and export networks moving NGLs across the U.S.
Now in June, with energy markets returning to some kind of new normal and with the official start of summer only 17 days away (June 20), we should be able to get a better sense of how propane is responding to current market dynamics. Here’s what we know:
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About the song
"Caught in the Balance" was written by Steve Lukather, David Paich, Simon Phillips, Mike Porcaro, Bobby Kimball and Stan Lynch. The song appears as the seventh song on Toto's 10th studio album, Mindfields. Personnel on the record were: Steve Lukather (guitars), David Paich (keyboards, backing vocals), Mike Porcaro (bass), Simon Phillips (drums, percussion) and Bobby Kimball (lead vocals).
Mindfields was recorded at Royaltone Studios, ATS Studios and Hollywood Sound Recorders in Los Angeles. It was produced by Toto and Elliot Scheiner. The album was released in November 1999 and went to #22 on the Billboard Top 200 Albums chart. Mindfields saw the return of original Toto member Bobby Kimball as lead vocalist. It also marked the departure of original keyboardist David Paich after the album's completion; Paich would rejoin Toto in 2010. "Melanie" was released as a single from Mindfields.
Toto was an American rock band formed in Van Nuys, CA, in 1977. Thirteen members have passed through its ranks since its inception. The band released 14 studio albums, seven live albums, 19 compilation albums, one soundtrack album and 65 singles. They have sold over 40 million records worldwide, and won six Grammy Awards. After finishing a tour in the fall of 2019, founding member Steve Lukather announced that the tour "would be the end of this configuration of Toto." Stay tuned ...
