NGL Prices Nov. 25: Ethane, Isobutane Prices Tumbled Along With Crude

NGL prices the week of Nov. 16 dropped almost entirely across the board at both hubs as ethane prices continued to bottom out and crude oil prices fell. Ethane prices took a downturn throughout the month of November as traders went long in anticipation of demand increasing following ethylene plant turnarounds.

According to En*Vantage, some ethylene producers sold ethane supplies in order to halt price increases. This resulted in traders that had gone long to further reduce their supplies, which accelerated the price decline.

This price decrease saw Mont Belvieu ethane drop 7% to 85¢ per gallon (/gal), its lowest price since it was 80¢/gal the week of Oct. 5. The market for Conway ethane experienced something of an uptick as the price rose 1% to 37¢/gal, its highest price in five weeks.

Following a huge increase the second week of November, isobutane prices had the largest decrease at both hubs. The Mont Belvieu price tumbled 10% to $2.17/gal and the Conway price dropped 6% to $2.09/gal. While these downturns were large they are significantly greater than prices at the same time last year. Isobutane demand actually remains strong due to propylene alkylation, but it fell off a bit as the rapid increase in demand was artificially inflated by the outage of one of Enterprise Products Partners’ isomerization units. Both prices the week of Nov. 16 were among the highest for the NGL this year.

The only other NGL to experience any real price decrease at both hubs was C₅₊, which fell 3% to $2.22/gal at Mont Belvieu and 1% to $1.95/gal at Conway because of the drop in crude oil prices. This marked the second consecutive week that isobutane had a higher price at Conway than C₅₊. However, it was able to regain its status as the most valuable NGL at Mont Belvieu due to the large drop in isobutane prices.