US propane inventories are well stocked heading into winter heating season

Propane inventories reflect supply and demand balances. Propane demand is greatest in the winter months because propane is used as the main heating fuel in about 5% of US homes, primarily in the northern parts of the Midwest and Northeast. For propane supply, propane gas plant production increased 5% in the first seven months of 2025 compared with the same period in 2024.

US propane inventories typically increase from April through September, when there is less demand, and decrease from October through March, when there is more demand. This year, weekly US propane inventories have been above previous five-year averages since late May.

The Gulf Coast, where most US petrochemical consumption and propane export capacity are located, accounts for about 70% of US propane storage capacity. Propane inventories in the Gulf Coast region are at 61 million bbl for the week ending 26 September, about 21% higher than the five-year average.

In the Midwest, where propane is more commonly used for residential space heating needs, propane inventories began October at 27 million bbl, about 4% more than the previous five-year average for that region. In some years, Midwest propane inventories can be affected by grain-drying demand, especially for corn. The US Department of Agriculture expects that this year’s corn crop will be harvested slightly later than the 2020 - 24 average, which may require more propane for grain drying. Grain-drying demand typically draws on Midwest inventories in late October and early November.

Inventories grew quickly earlier this year because of growing domestic propane production, particularly in the Gulf Coast region. This production growth outpaced international demand for US propane exports, which have increased slightly throughout 2025, despite changes in tariffs that affected propane export volumes earlier in the year.

Inventory levels affect prices. Propane spot prices on the US Gulf Coast have declined largely because of strong inventory builds this storage injection season. The propane spot price at Mont Belvieu, Texas, averaged US$0.70/gal. in the week ending 26 September, or US$0.19 /gal. lower than in the first week of April. Although market events such as prolonged, severe winter storms or geopolitical developments could put pressure on spot propane prices this winter, relatively robust US propane inventory levels could mitigate spot price volatility that can arise from sudden increases in demand or disruptions to supply chains.

Read the article online at: https://www.hydrocarbonengineering.com/special-reports/08102025/us-propane-inventories-are-well-stocked-heading-into-winter-heating-season/