Propane Surges While Crude Stalls – What Market Signals Are Telling Us
Key Takeaways:
Once a domestic heating fuel, propane is now a global export commodity, increasingly influenced by Asian demand and crude benchmarks
Propane prices remained firm this winter due to strong demand, export pull, and Gulf Coast infrastructure hiccups
With crude in the mid-to-upper $60s and propane near 40% of WTI, end users may find current levels attractive for layered price protection
Watch the full discussion below:
To sign up for the Focus on Fuels podcast, find it on your preferred podcast platform: Apple Podcasts, Spotify, or YouTube.
To sign up for the Focus on Fuels podcast, find it on your preferred podcast platform: Apple Podcasts , Spotify , or YouTube . With oil markets range-bound and product prices facing resistance, the latest Focus on Fuels podcast episode turns its attention to propane – a market that’s held up surprisingly well despite seasonal expectations.
Focus on Fuels hosts Alex Hodes and Trevor McClanahan were joined by StoneX Risk Manager Nathan Keown, who brings first-hand experience from the midstream propane world. Together, they unpack what’s been happening in propane markets, why prices are rising at a time when they typically fall, and how traders and end users should be thinking about hedging in this evolving environment.
According to Keown, the propane landscape has changed dramatically over the last decade and a half. Once a primarily domestic heating fuel with demand dictated by U.S. winters, propane has become a global export product, increasingly tied to the whims of international demand and crude oil benchmarks. With U.S. production significantly outpacing domestic use, exports—especially to Asia—have become the market-clearing mechanism.
Recent price action reflects both strong winter demand and growing export pull. Conway and Gulf Coast (Belvieu) prices ran higher in January and February, supported by weather-driven consumption and some unplanned hiccups at Gulf Coast fractionators. That tightness, Keown notes, mirrors the broader global competition for feedstocks like naphtha and propane in petrochemical manufacturing—especially in China. And despite the recent firmness, Keown sees opportunities for end users. “Crude in the mid to upper $60s puts propane in a pretty attractive place to start locking in prices,” he explains. He suggests that a level around 40% of WTI—a typical pricing benchmark—can serve as a guide, with lower-to-mid 70s cents per gallon offering solid value.
For propane marketers, the key is protecting their customer base from unexpected spikes—whether driven by winter demand, supply chain hiccups, or geopolitical tension. Hedging part of the book early, then layering in exposure opportunistically, allows flexibility while limiting downside risk.
The episode also touches on propane’s relationship to other fuels. While once assumed to follow natural gas prices, Keown emphasizes that its correlation to crude is much stronger—something new market entrants often learn the hard way. As the U.S. expands export capacity in the Gulf Coast, that linkage to global oil markets is only expected to grow.
In other words, propane may look like a simple domestic product—but it’s playing on a global stage.
Subscribe to the Podcast
Stay ahead of market moves with Focus on Fuels, StoneX's essential podcast for energy and fuel market participants. Each episode features Alex Hodes and Trevor McClanahan breaking down market developments. You’ll also hear from industry experts who explore hedging strategies and practical insights for managing price volatility. Available on all major podcast platforms, including Apple Podcasts, Spotify, or YouTube.
Dive Deeper
Receive more in-depth analysis and commentary on the energy market from Alex and the energy team via the KC Energy Newsletter. Sign up for your free 2-week trial today.
---Experts: Nathan Keown, Energy Risk Manager; Alex Hodes, Director of Energy Market Strategy and Trevor McClanahan, Energy Risk Manager
Energy
StoneX TV content is created, produced, and distributed solely by StoneX Media Ltd (“StoneX TV”) and is provided for informational and educational purposes only. StoneX TV does not provide investment, financial, legal, or tax advice and does not make any recommendation or endorsement of any investment strategy, transaction, or financial instrument. Nothing in this content constitutes, or should be construed as, investment advice or a recommendation to buy, sell, or hold any financial instrument, including securities, futures, derivatives, digital assets, foreign exchange products, or CFDs. This content does not constitute an offer, invitation, or solicitation to engage in any investment activity. The information presented is general in nature and is not tailored to the financial situation, investment objectives, or risk tolerance of any specific person. You should not rely on this content as a substitute for independent professional advice. Investing and trading in financial instruments involves significant risk of loss and is not suitable for all investors. Past performance is not indicative of future results. Any views or opinions expressed are those of the presenter at the time of publication and are subject to change without notice. Such views may not necessarily reflect those of StoneX Media Ltd or its affiliates. StoneX Media Ltd and its affiliates, including StoneX Group Inc., may from time to time have positions in, or engage in transactions involving, the financial instruments referenced. This content may include general market commentary and opinion. It does not constitute independent investment research and has not been prepared in accordance with legal requirements designed to promote the independence of investment research. StoneX Media Ltd is not authorised or regulated to provide investment services and does not act in a fiduciary capacity. StoneX Media Ltd is incorporated in Ireland and operates in accordance with applicable Irish law. It is a wholly owned subsidiary of StoneX Group Inc. and is a separate legal entity from other subsidiaries within the StoneX Group, which may be regulated in various jurisdictions. StoneX Media Ltd does not act on behalf of, or provide services for, any regulated affiliate. This content is not directed at, and may not be distributed to, any person in any jurisdiction where such distribution would be contrary to local laws or regulations. Supporting documentation for any claims, comparisons, statistics, or technical data may be made available upon reasonable request, where applicable.
Discover more insights
Our subscribers have access to comprehensive market analysis from StoneX spanning commodities, equities, currencies and more.
Our market expertise, advanced platforms, global reach, culture of full transparency and commitment to our clients’ success all set us apart in the financial marketplace.
Reach
With access to 40+ derivatives exchanges, 180+ foreign exchange markets, nearly every global securities marketplace and numerous bi-lateral liquidity venues, StoneX’s digital network and deep relationships can take clients anywhere they want to go.
Transparency
As a publicly traded company meeting the highest standards of regulatory compliance in the markets we serve, our financials and record of accomplishment are matters of public record. StoneX’s commitment to “doing the right thing over the easy thing” sets us apart in the industry and helps us build respect, client trust and new partnerships.
Expertise
From our proprietary Market Intelligence platform, to “boots on the ground” expertise from award-winning traders and professionals, we connect our clients directly to actionable insights they can use to make more informed decisions and achieve their goals in the global markets.
