Frac Spread: NGL Prices Rise, but Outlook Joyless

The gloomy forecast will falter if COVID-19 passes quickly and the global economy recovers its appetite for hydrocarbons.

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(Source: Paul Orr/Shutterstock.com, keksik97/Shutterstock.com, HartEnergy.com)

With the exception of isobutane and natural gasoline at Conway, Kan., NGL prices rose across the board at Mont Belvieu, Texas, and Conway last week and, with the exception of Conway isobutane, margins improved as well.

If the results of this nowhere-to-go-but-up week spark joy then hold onto the feeling—you deserve it. It won’t last, however, because prices for NGL, oil and gas can and almost certainly will continue to fall.

“We are having a difficult time coming up with a scenario for higher crude prices in the near future,” EnVantage Inc. said in a report. “In fact, we can see crude prices going much lower. The severe demand shock that we are experiencing has not been fully captured by government statistical reports yet.”

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Joseph Markman

Joseph Markman, senior editor for Hart Energy, covers markets and provides data analysis for all Hart Energy editorial products.