www.eia.govU.S. Energy Information Administration Independent Statistics & Analysis

Propane Market Update

March 28, 2018 | Washington, DC(Inventory data as of 03/23/18; residential heating fuel prices as of 03/26/18)

ByU.S. Energy Information Administration

0.0

0.2

0.4

0.6

0.8

1.0

Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-185-year range inventory level rolling 5-year Avg

PADD 1A (New England) propane inventories above the 5-year averagePADD1A propane* inventoriesmillion barrels

Source: EIA, Weekly Petroleum Status Report, data through March 23, 2018 *propane/propylene for fuel use only

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PADD REGIONS

1B2

3

45

1C

1A

0

1

2

3

4

5

6

Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-185-year range inventory level rolling 5-year Avg

PADD 1B (Mid-Atlantic) propane inventories above the 5-year averagePADD1B propane* inventoriesmillion barrels

Source: EIA, Weekly Petroleum Status Report, data through March 23, 2018 *propane/propylene for fuel use only

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PADD REGIONS

1B2

3

45

1C

1A

0

5

10

15

20

25

30

35

Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-185-year range inventory level rolling 5-year Avg

PADD 2 (Midwest) propane inventories within the 5-year rangePADD 2 propane* inventoriesmillion barrels

Source: EIA, Weekly Petroleum Status Report, data through March 23, 2018 *propane/propylene for fuel use only

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-10

-8

-6

-4

-2

0

2

4

6

8

10

Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18

inventory level (difference from 5-year average)

PADD 2 (Midwest) propane inventories below 5-year-average levelsPADD 2 propane* inventories, difference from 5-year averagemillion barrels

above5-year average

below5-year average

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Source: EIA, Weekly Petroleum Status Report, data through March 23, 2018 *propane/propylene for fuel use only

Selected state propane* inventories

Source: EIA, Weekly Petroleum Status Report, data through Mar. 23, 2018

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*propane/propylene for fuel use only; inventories include stocks at terminals, gas plants, and refineries only

0

4,000

8,000

12,000

16,000

20,000

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

Kansas propane stocksthousand bbls

5-year range Year ago inventories 5-year average

0

1,500

3,000

4,500

6,000

7,500

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

Michigan propane stocksthousand bbls

5-year range Year ago inventories 5-year average

0

500

1,000

1,500

2,000

2,500

3,000

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

Illinois, Indiana, Ohio propane stocksthousand bbls

5-year range Year ago inventories 5-year average

0

200

400

600

800

1,000

1,200

Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep

Iowa, Minnesota, Wisconsin propane stocksthousand bbls

5-year range Year ago inventories 5-year average

0

10

20

30

40

50

60

70

Oct-17 Nov-17 Dec-17 Jan-18 Feb-18 Mar-18 Apr-185-year range inventory level rolling 5-year Avg

PADD 3 (Gulf Coast) propane inventories within the 5-year rangePADD 3 propane* inventoriesmillion barrels

Source: EIA, Weekly Petroleum Status Report, data through March 23, 2018 *propane/propylene for fuel use only

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-40

-30

-20

-10

0

10

20

30

40

Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18

inventory level (difference from 5-year average)

PADD 3 (Gulf Coast) propane inventories below the 5-year averagePADD 3 propane* inventories, difference from 5-year averagemillion barrels

above5-year average

below5-year average

Source: EIA, Weekly Petroleum Status Report, data through March 23, 2018 *propane/propylene for fuel use only

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Propane spot prices above same time last year; Conway, KS discount to Mt. Belvieu, TX at ~14¢/gal and narrowingPropane spot prices (Conway, KS and Mont Belvieu, TX)dollars per gallon

Source: EIA, Bloomberg, data through March 26, 2018

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0.00

0.20

0.40

0.60

0.80

1.00

1.20

Sep Oct Nov Dec Jan Feb Mar Apr

Conway(2016-17)

Conway(2017-18)

Mont Belvieu(2016-17)

Mont Belvieu(2017-18)

This Winter(2017-18)

Last Winter(2016-17)

NOAA’s projected temperatures: April 2 – Apr. 6, 2018, and April 4 – Apr. 10, 2018

• NOAA weather projections into April suggest a return of colder-than-normal temperatures through the first week of the month across much of the Midwest, New England, and Mid-Atlantic regions

• With highest probability of below-normal temperatures centered on the Great Lakes region, there is a possibility of heating season stretching into April, resulting in above-average heating fuel demand in an area with high propane market share

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A = temperatures above normal

N = equal chance thattemperatures are above normal, normal, or below normal

B = temperatures below normal

Source: NOAA, Mar. 27, 2018

12

3

45

Petroleum Administration for Defense Districts (PADDs)

Generally, tariff on the TEPPCO* pipeline sets the ceiling in the Northeast; recent fall in non-LST propane at Mt. Belvieu drove decline in Selkirk price

TEPPCO = Enterprise TE Products Pipeline Company LLCSource: EIA, Bloomberg, data through March 26, 2018; Enterprise Products Partners L.P., Effective Tariffs, FERC No. 54.42.0

propane spot pricesdollars per gallon

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propane price spreaddollars per gallon

$0.00

$0.10

$0.20

$0.30

$0.40

$0.50

$0.60

$0.70

$0.80

$0.90

$0.00

$0.20

$0.40

$0.60

$0.80

$1.00

$1.20

$1.40

$1.60

$1.80

Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18

Selkirk, NYMont Belvieu, TX

approx. TX-NY TEPPCO tariff (RS)

Mt. Belvieu to Selkirk spread (RS)

State Heating Oil and Propane Program (SHOPP) updates• SHOPP is a collaborative program between states and EIA that provides weekly

wholesale and retail prices for heating oil and propane at the state level

• EIA has extended SHOPP (beginning October 2014) to include 14 additional states in propane price data collection

• 10 new states were added to the wholesale propane price survey in 2016. This should be taken into consideration when comparing the average prices for last year (2015-2016 season) for the U.S., PADD 1, PADD 1B, PADD 1C, and PADD 2 averages

• EIA is providing more granular inventory data to states on a weekly basis since the 2016/2017 heating season

• New winter fuels page provides easier access to state-level information: www.eia.gov/special/heatingfuels

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U.S. Energy Information Administration

Maps of states participating in Winter Fuels Survey

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Source: EIA, Heating Oil and Propane Update

PADD 1dollars per gallon

PADD 2dollars per gallon

U.S. Energy Information Administration

Retail propane prices this heating season in PADD 1 and PADD 2 are above prices reported for the same week last year

Source: State Heating Oil and Propane Program, data through March 26, 2018

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0.00

1.00

2.00

3.00

4.00

Oct Nov Dec Jan Feb Mar

heating oil (2017-18)propane (2016-17)

propane (2017-18)

heating oil (2016-17)

0.00

1.00

2.00

3.00

4.00

Oct Nov Dec Jan Feb Mar

heating oil (2017-18)

propane (2016-17)

propane (2017-18)

heating oil (2016-17)

U.S. Energy Information Administration

Various days-of supply/disposition measures

Note: *disposition = domestic product supplied + exportsSource: U.S. Energy Information Administration, Weekly Petroleum Status Report, data through March 23, 2018 For more information, please see EIA’s webinar on Propane Market Indicators and Measures of Supply Adequacy

U.S. weekly stocks of propanedays of supply & disposition

15

0

20

40

60

80

100

120

140days of supplydays of disposition*days of supply under severe winter conditions

For more informationU.S. Energy Information Administration home page | www.eia.gov

State Energy Portal | www.eia.gov/state

Winter Heating Fuels Site | www.eia.gov/special/heatingfuels/

Movements of Propane by Rail | http://www.eia.gov/dnav/pet/pet_move_railNA_a_EPLLPA_RAIL_mbbl_m.htm

Today in Energy | www.eia.gov/todayinenergy

Short-Term Energy Outlook | www.eia.gov/steo

Energy Explained – Hydrocarbon Gas Liquids | http://www.eia.gov/energyexplained/index.cfm?page=hgls_home

Annual Energy Outlook | www.eia.gov/aeo

International Energy Outlook | www.eia.gov/ieo

Monthly Energy Review | www.eia.gov/mer

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