USGC isobutane spread over normal butane remains at six-year high

Chemical News: USGC isobutane spread over normal butane remains at six-year high

https://www.chemnet.com Nov 09,2011 Platts
The premium for isobutane over normal butane for the Gulf Coast region held at a six-year high of 45.50 cents Tuesday, showing no change since the end of last week as market sources said isobutane supply is short amid talk of a production issue.

Platts assessed non-LST isobutane at the Mont Belvieu, Texas, trading hub at $2.2835/gal, down 65 points from Monday. Non-LST normal butane was assessed at $1.8285/gal, also off 65 points from Monday.

Last year, Mont Belvieu isobutane carried a 2.75-cent premium over normal butane, according to Platts data.

According to market sources, Enterprise Products is having issues with a butamer unit, which processes normal butane into isobutane. Enterprise did not return requests for comment.

Without any details, others are left speculating on the historic price spread.

"I think isobutane demand is just high," a trader said.

In the Midwest region, isobutane was assessed at $2.0125/gal, a 45-cent premium over Conway normal butane.

Market sources expressed interest in getting barrels from the Midcontinent to the Gulf Coast, but logistical problems stand in the way.

"Conway isobutane is lagging [Mont Belvieu] big time, but there are no rail cars or spots to move it out," a trader said.

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