LPG in World Markets: US Arbitrages Improve on Lower LPG Prices, Asian Demand

This current feature was extracted from the latest edition of Poten’s LPG in World Markets, a monthly service published on May 10, 2024.

LPG prices trended down in April and continued to trend downward in May, with US Gulf Coast prices showing a steeper decline, which is widening the arbitrage for US exports between both the Far East and Europe. These arbitrages widened sharply in the first week of May, driven by the relative strength of Far East propane prices, which is mainly attributed to improving demand from the petrochemical sector. Wide propane-naphtha spreads in Asia are driving LPG demand in mixed feed crackers, while propane demand from Chinese PDH plants has also increased with the start-up of new plants in 1Q and as several existing units came back online, following some maintenance.

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