The price of ethane established a new high for the year at Mont Belvieu, Texas, in the past week while the hypothetical composite NGL barrel left $27 in the rear view mirror at both hubs to reach its highest level in six months.

If summer weather has been, statistically, relatively mild compared to a year ago, NGL have been hot. Mont Belvieu ethane is up 42.7% since its low point in January and Conway, Kan., ethane has risen 35.1% since its low for the year in March.

The NGL barrel passed $27 for the first time since February at Conway and has stayed at that mark for three straight weeks at Mont Belvieu. The Mont Belvieu price is 38.4% higher than it was last year at this time, with the Conway price 39.9% higher.

“NGLs have been heating up this year because of improved fundamentals, while oil and natural gas prices have been depressed,” wrote En*Vantage Inc. analysts in a report.

Ethane inventories are high, but so are exports and increased cracking demand as well as market anticipation of demand from crackers lining up to begin operations. These factors support the steady uptick in price at both hubs.

But back to the weather.

Bearing down on the Texas Gulf Coast this past week was Harvey, a tropical storm expected to make landfall as a Category 3 hurricane. Storms of this magnitude that make landfall in the U.S. tend to have bearish consequences on natural gas markets, En*Vantage noted, but the second half of August is projected to be above the 30-year normal.

Compounding the heat are expectations of lower gas injections into storage. By the first week in September, En*Vantage said, the U.S. Energy Information Administration’s (EIA) storage figure should be below the five-year average.

Storage of natural gas in the Lower 48 increased by 43 billion cubic feet (Bcf) in the week ended Aug. 18, the EIA reported. Last week’s increase, below the Bloomberg consensus of 46 Bcf, is below the five-year average increase of 53 Bcf. In 2016, storage increased by 12 Bcf. The increase resulted in a total of 3.125 Tcf. The figure is 6.7% below the 3.348 Tcf figure at the same time in 2016 and 1.5% above the five-year average of 3.08 Tcf.

Propane slipped at both hubs but was still 65.7% above last year’s price at Mont Belvieu and 80.6% above last year’s price at Conway. Strong demand from Chinese and Indian buyers, and the expectation of a cutback in Saudi exports has tightened the international market.

Whether U.S. exporters can take advantage depends on the price remaining low enough to entice foreign buyers. En*Vantage foresees a propane price spike if the U.S. experiences an early winter.

Butane, which cracked 90 cents per gallon (gal) for the first time since February at both hubs, will see upward price pressure as a result of an anticipated 10% increase in demand from India and the start of winter-grade gasoline production next month from refiners.

Joseph Markman can be reached at and @JHMarkman.