First up, a note from Flashpoint’s Trader and veteran propane market consultant Darius Lechtenberger:
“WTI crude oil and and refined product prices are taking a beating this morning with May WTI crude futures prices falling below $94. WTI crude oil is nearing the pre-Ukrainian invasion price level of $92. There are really no new headlines. China continues to implement COVID lockdowns, the SPR crude oil release is underway and the EU is still trying to wean off of Russian energy supplies. Europe can’t even ban Russian coal exports right away. While some in Europe want to move to get off Russian oil and gas, the sad reality is that Europe has become so dependent on Russian oil and gas that even with the outrage that we’re seeing in Ukraine, they can’t cut themselves off from supply because it will put their economies into a recession. Now the EU Is looking to the U.S. to fill their future natural gas needs. Prices have been trending higher since Biden vowed that the U.S. and other nations will increase liquified natural gas exports to Europe by 15 billion cubic meters this year and that even larger shipments would be delivered in the future. This comes as U.S. natural gas supplies are 17% below their five-year average. In Europe, stocks are around 20% below their five-year average. Today’s price drop looks like another opportunity to layer in purchases for the coming winter.”
WTI closed at $98.26 on Friday and propane values were off a couple of cents earlier this morning from where things ended on Friday, but they have bounced back as the morning has progressed.