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Weekly SummaryMarkets/International

LPG: Jun 14-18: Spread between butane and propane enlarges

CFR Far East

The Rim Asia Index for propane and butane, which indicates CFR Far East spot prices, was at $621.75/mt and $636.75/mt as of Jun 17, up $5.00/mt and $20.00/mt respectively from Jun 11. For propane, prices were supported by rising crude prices but buying interest somewhat retreated on Jun 15 onwards since players were wary of high prices. Discussion levels for 23,000mt propane cargoes for second-half July delivery were at about $617/mt. Meanwhile, supply of cargoes containing butane was tight. Buying interest from China, Taiwan and Vietnam emerged while there were few active sellers in the market. Thus, butane prices rose more sharply than propane prices.

 

FOB Middle East

The July CP forecast was revised up to $590-595/mt for propane and $595-600/mt for butane due to strong demand for even-split cargoes. Some players holding term supply commitments to India such as One North Sea producer and one British Major were seeking even-split cargoes in the spot market owing to term supply reduction from Saudi Aramco. Bids for 44,000mt 50:50 cargoes for July loading were heard at a premium of $8-9/mt to the July CP. Meanwhile, regarding a sell tender issued by one Qatari producer, one Chinese trader seemed to have won a 45,000mt propane cargo at a discount of $3/mt to the July CP.

 

Asia Pressurized Market

On FOB South China, one importer from South China can sell spot cargoes for first-half July delivery at a premium in the low $40's/mt to the July CP. Regarding CFR Vietnam, Vietnamese importers were expected to decrease intakes of term cargoes for July delivery due to weak domestic demand in Vietnam. 

 

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