West Texas Intermediate (WTI) closed above $60 on July 10 after the U.S. Energy Information Administration (EIA) reported an inventory draw that was much higher than expected, and the National Hurricane Center gave a nearly 100% chance of a major storm developing in the northeastern Gulf of Mexico by July 11.
Ethane’s Mont Belvieu price is down more than 60% since the same week in 2018, and its margins continued to worsen at both Mont Belvieu and Conway, Kan., hubs, with Mont Belvieu’s expanding to more than 1 cent/gal.
If ethane cannot be shipped then it must go into storage, where Gulf Coast capacity has not been able to keep up with rapidly growing production. That puts pressure on the entire value chain.
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