Slide 4 of 28
Notes:
- The residential and commercial sector and the chemical sector are the largest end users of propane in the U.S., accounting for 34% and 41% respectively of the market.
- This annual total demand chart does not show the large variation in demand that occurs across the year.
- -As already mentioned, total demand fluctuates seasonally, and the residential/commercial sector probably accounts for most of the variation.
- If all of the variation is attributed to the residential/commercial sector, that sector’s demand, which is 34 percent of total on average, would vary from about 50 percent of total demand during the January peak demand month to as low as 15 percent during May, the usual summer low point.
- The residential market is the high-valued market and generally sets the price for propane during the winter when residential demand is high.
- The chemical sector provides a floor for propane prices, which is usually visited during the summer months when residential use is low.
- The U.S. petrochemical market played an important role in the excess stocks in 1998, which is shown on the next slide.
