Natural gas liquid (NGL) prices continued to improve for the most part at both hubs this week with ethane and propane supplies below normal levels and improving crude prices. For the week of Aug. 31, the only NGL prices to fall were Conway propane and Mont Belvieu isobutane.

The 1% price drop in Conway propane is due to Enterprise Products Partners’ Mid-America Pipeline (MAPL) outage that is causing gas to be stranded at Conway, according to En*Vantage. The price fell to $1.44 per gallon (/gal), its lowest price in a month. By comparison, Mont Belvieu propane improved 1% to $1.56/gal, the highest it has been since it was $1.58/gal the week of April 27.

Although Mont Belvieu isobutane fell 1% to $2.07/gal, the price was the second highest at the hub in a month. This decrease may be a result of lesser demand for alkylate due to the end of the summer driving season. However, Conway isobutane had the largest price increase at either hub as it improved by 7% to $2.04/gal on limited trading. The smaller sample size makes it difficult to analyze the market dynamics in place, but it should be noted that the lone day that isobutane was actively traded at Conway was Sept. 1, just before the Labor Day holiday.

Pentanes-plus (C5+) showed the greatest strength between the two hubs with price increases of 3% at each location. This improvement was largely due to improved crude prices that were spurred on by strengthening in the stock market. The Mont Belvieu price rose to $2.40/gal, its highest price since the week of July 27, when it was $2.46/gal. The Conway price of $2.10/gal was also that hub’s highest price since it was $2.22/gal the week of July 27.

Butane prices also benefitted from improved crude prices as the Mont Belvieu price rose 1% to $1.92/gal and the Conway price increased 2% to $1.65/gal. Both prices were the highest at their respective hubs since the week of July 27, when the Mont Belvieu price was $1.93/gal and the Conway price was $1.69/gal.

Ethane prices’ relationship to crude prices was slightly below 35%, the level, which En*Vantage has said it needs to remain more preferred than naphtha. The Mont Belvieu price improved 2% to 70¢/gal, its highest price in a month. The Conway price had a larger increase at 3%, but had more ground to make up after losing more than 10¢/gal in value over the previous month. For the week of August Aug. 31, the price was 38¢/gal. This was the second lowest price at the hub since the week of September Sept. 15, 2010.

While ethane prices showed improvements at both hubs, the cracking capacity in the United States dropped to approximately 90% due to the 40-day planned maintenance of the 1.8 billion billion-pounds pounds-per per-year (lb/yr) Point Comfort (Texas) #2 cracker being down for maintenance for 40 days by its owner Formosa Petrochemical Corp., and the 45-day planned maintenance for at Exxonmobil’s ExxonMobil’s 2.175 lb/year facility in Baton Rouge, La.

Contact the author, Frank Nieto, at fnieto@hartenergy.com.