Weekly Insights - June 1, 2018

Good afternoon. I hope everyone had a safe and enjoyable Memorial Day weekend. According to the news, this is the first time all three days of the weekend have been over 90 degrees. After the late cold spring, I’m not complaining…yet.

Well another week has gone by with energy markets doing the unexpected. Last week, Russia and OPEC were all for increasing oil production to make up for a lack thereof from Iran and Venezuela. The market response from Friday through Tuesday was an .08 drop. This week OPEC and Russia changed their minds and Wednesday was up .04. Today, (Thursday) based off of fears of another trade war this time with Canada, Mexico, and Europe the market closed back down .04.  The weekly inventory of WTI crude and products was also somewhat bearish taking away a little price support. Propane, on the other hand, was only up 1 mmb in PADD 2, which is the Midwest, with a total increase across the US of 2 mmb. Normal build this time of year is just under 3mmb.

Since we are on the subject of propane, I’m sure you can see where I’m going with this…higher priced LP this year. I would guess not many of you are thinking of LP needs just yet, but summer fill, contracting, and budget pricing are just around the corner. Unfortunately, it is more lucrative to export LP over seas than to sell it at home. What this means is shorter supply and higher prices to us as consumers. Another issue is the relationship of LP to crude. Most of the year LP follows crude, but this time of year because of lower demand it will separate and do its own thing pricewise. That is not happening this year I believe mainly due to the export situation.  More to come on pricing in the next couple weeks.

One more quick note, our service techs will be contacting LP customers with outdated regulators to upgrade. Please allow them to do this. It is for your safety and wellbeing.
 
Thanks for your continued business.
 
 
 
Transport Price Ruby Fieldmaster 7500 gal minimum
 
Britton Area $2.4599**
Aberdeen/ Groton Area $2.4358**
Doland Area $2.4599**
Forman/Gwinner Area $2.4591**

**Please call for exact pricing as prices are subject to change at anytime without notice.