The price of ethane at Mont Belvieu, Texas, continued its upward trudge for the sixth time in the last seven weeks, reaching not just the second-highest level for the year but the third-highest point since July 2014.

Only 1.22 cents per gallon (gal) separated last week’s ethane price from the late-December 2016 peak, which dipped only slightly during the first week of 2017. At Conway, Kan., last week’s price was third-best of the year behind a two-week surge above 23 cents/gal in early February.

Why such good grades as kids in many parts of the country head back to school? Especially as crude oil lags in the $40s per barrel and natural gas sticks in the nothing-special sub-$3 million Btu range.

En*Vantage suspects stronger demand and firm naphtha prices in Asia could be influencing the U.S. market. The presence of Dow Chemical’s $6 billion Freeport, Texas, cracker—now in the process of starting up—is probably not hurting, either.

Ethane is the most economical feedstock for crackers and the result of this upward trend is higher cracking margins, En*Vantage said. Mont Belvieu’s estimated ethane margin was 7.35 cents/gal last week, a 3.59% increase over the previous week; at Conway, the margin widened by 4.36%.

Crude oil’s price woes are tied to fears of increased OPEC production, especially from Nigeria and Libya, En*Vantage said. That and the previously mentioned return of kids to school, i.e., the summer driving season is ending and gasoline demand will ease.

However, the U.S. Energy Information Administration (EIA) reported on Aug. 16 that crude inventories had declined for the seventh straight week with a drawdown of 8.95 million barrels (MMbbl). It was the steepest decline in almost a year and more than three times the analyst consensus of 3.1 MMbbl.

En*Vantage expects lower U.S. crude imports during the final third of the year, with Saudi Arabia cutting production and Venezuela in chaos.

Ethane was not alone in upward mobility. Propane set highs since mid-February at Mont Belvieu and early February at Conway. The rally since late June has propelled propane by 32.3% at Mont Belvieu and 35.3% at Conway. The price is 73.7% higher than at this time last year at Mont Belvieu, and a mighty 98.1% higher at Conway.

Propane inventories are well below five-year average levels, with En*Vantage expecting a peak in October at 11 MMbbl below that average. The canceled cargoes that plagued propane earlier in the year appear to no longer be an issue and the analysts expect exports to pick up again in September and October.

Butane has remained above 80 cents/gal at both hubs for three weeks, its longest stay at that level since its precipitous decline in late February. The Mont Belvieu price is 54% above its level of a year ago, with Conway’s price 62.7% higher.

En*Vantage anticipates a butane price surge in the fall with demand increasing from India and a cut in exports from Saudi Arabia.

Storage of natural gas in the Lower 48 increased by 53 billion cubic feet (Bcf) in the week ended Aug. 11, the EIA reported. The agency revised its figures to reflect resubmissions of data during the six-week period from June 30 to Aug. 4, attributed to restatements of natural gas in storage from working gas to base gas.

Last week’s increase, more than the Bloomberg consensus of 48 Bcf, is above the five-year average increase of 50 Bcf. In 2016, storage increased by 23 Bcf. The increase resulted in a total of 3.082 Tcf. The figure is 7.6% below the 3.336 Tcf figure at the same time in 2016 and 1.8% above the five-year average of 3.027 Tcf.

Joseph Markman can be reached at jmarkman@hartenergy.com and @JHMarkman.