Slide 24 of 28
Notes:
- With supply increasing over 1998 levels, demand will have to increase even more to work off the excess inventories. This table summarizes a scenario that could bring stocks back to average levels by the end of next winter.
- The supply projection is that shown on the prior slide for U.S. refinery and gas plant production.
- This scenario shows imports slightly weaker than last year’s imports. With strong Atlantic Basin supply, this assumption may be low.
- Non-chemical demand will have to be quite strong. The scenario’s non-chemical demand is based on 1997 levels. Non-chemical demand in 1999 is starting slightly higher than in 1997, and this scenario assumes a 1% growth over 1997 for the remainder of the year. If weather is warm, this scenario assumption will become invalid.
- Ethylene feedstock demand for propane is also assumed to stay relatively high. In 1998, the very low prices encouraged use of propane as ethylene feedstock. This scenario assumes petrochemical propane demand stays about the same level as we saw in 1998.
- In total, the chances of a scenario occurring that would quickly draw down the excess stocks is less than 50:50; thus, it is likely stocks will remain on the high side rather than on the low side.
