PADD 3 (Gulf Coast) propane stocks

PADD 3, the Gulf Coast, is where most of the country's propane originates rather than where most of it is used. Refineries and gas processing plants here produce the bulk of US supply, and the salt caverns around Mont Belvieu hold the country's largest concentration of underground storage, the reserve that pipelines draw down to supply the Midwest and the East Coast through the winter. The Gulf Coast is also the export hub: cargoes loaded here for Asian and Latin American buyers are the biggest structural claim on the summer build, competing with the rest of the country for the same barrels. Stocks build here from spring through summer and draw down through the heating season like everywhere else, but because this region supplies the others, its five-year band reads on export demand as much as on winter weather.

Export desks trade against this number. Cargoes load from terminals along the Houston Ship Channel and the lower Mississippi, and a heavy loading program can pull the region's stocks down in weeks that have nothing to do with weather anywhere. EIA counts propane and propylene in primary storage, which here means the salt caverns and terminal tankage rather than anything downstream of a dealer, reported in thousand barrels every Wednesday in the Weekly Petroleum Status Report for the week ended the previous Friday. Because the rest of the country refills out of this region, a Gulf Coast level running under its five-year band in September is a warning about the coming winter everywhere else, not only here.