CFR Far East

In the CFR Far East market last week, prices went up since crude oil prices were firm and supply/demand was perceived to be tight. The Rim Asia Index for propane and butane as of Jan 16 was at $644.25/mt and $634.25/mt respectively, up $16.25/mt and $21.25/mt from Jan 10. With Supply/demand fundamentals for butane being seen to be tight, a rise in butane prices was larger than that for propane. US butane prices were much higher than propane prices, market sources believed that it might be difficult for cargoes containing butane to be flowed into the Far East. Under this situation, several Far East importers were seeking cargoes containing butane in the market. One Japanese importer was reported to have bought a 44,000mt 50:50 cargo for February delivery from one Canadian supplier and another Japanese importer seemed to be still in the market. For propane, the market was pulled up by demand from traders trying to cover their short positions.

FOB Middle East

The February CP was forecast at about $636/mt for propane and about $626/mt for butane. Supply/demand was perceived to be slack. A Middle East trader with a 44,000mt 50:50 cargo for February loading had offered at a discount in the low $10's/mt to the February CP but apparently could not find a buyer. Another Middle East trader was seen to have bought a 44,000mt 50:50 cargo for early February loading from a European Major at a discount of $15/mt to the February CP. This was believed to be the current discussion level for 44,000mt 50:50 cargoes. Saudi Aramco was said to have released its February loading acceptance. Aramco apparently imposed minus 10% tolerance on propane to some term customers.

Asia Pressurized Market

On an FOB South China basis, one Chinese importer was offering 1,800mt for February loading at a premium of $55/mt to the February CP, but it was unclear whether the importer finished selling. For Southeast Asia loading, a Malaysian petrochemical company, Pengerang Refining and Petrochemical (PRefChem), was said to have carried out a sell tender for LPG cargoes loading in Pengerang on Jan 21-22, Jan 30-31 and Feb 5-6. The tender was closed at 12:00 on Jan 17. In the meantime, one importer in the Philippines was considering reselling term cargoes for February or March delivery.