CFR Far East

The CFR Far East market softened for both Japan delivery and China delivery amid a sharp decline in crude oil prices. Looser supply/demand for propane also weighed on the market. As of May 7, the Japan Index stood at $820.50/mt for propane and $998.50/mt for butane, while the China Index stood at $904.50/mt for propane and $1,004.50/mt for butane, all marking a decline of $78.00/mt compared with Apr 30. While several traders and Chinese petrochemical companies moved on spot purchase for pure propane cargoes, overall demand was perceived to be weak. Operating rates at petrochemical plants in China remained low and plant operators were not rushing to procure cargoes in the spot market. Some petrochemical companies refrained from full‑cargo procurement and instead seeking to meet demand with half cargoes. Amid weak buying interest, sellers were gradually digesting cargoes on hand. Meanwhile, while US‑origin even‑split cargoes were flowing into India, few sellers were offering such cargoes to the Far East, leaving butane supply/demand tight.

FOB Middle East

Prices for 44,000mt 50:50 cargoes for June loading were heard at a premium of $125-135/mt to the June CP, showing no change from the previous week. Amid the continued closure of the Strait of Hormuz, no notable progress in discussions was seen. As previously reported, Iraq's State Organization for Marketing of Oil (SOMO) closed a buy tender on Apr 29 with validity until 20 days from the closing date. SOMO was trying to buy two cargoes of 15,000mt each of LPG for delivery from May 1 onward on a CIF basis. Results had not been disclosed by this week. Although some vessels capable of loading cargoes remained available within the Persian Gulf, some owners were said to be hesitant to proceed with loadings due to the risk of potential attacks. Meanwhile, some sources pointed out that truck lots could be supplied from Iran. Regarding the US-Iran conflict, negotiations between the two countries toward ending hostilities seemed to be ongoing.

Asia Pressurized Market

The pressurized cargo market was seen to be weak due to slackening supply/demand. For South China loading, buying interest was weak while there were several sellers having room to offer spot cargoes. Under this situation, discussion levels dropped to a premium of $250/mt to the CP later last week. In the Philippines, importers have high stocks and were reluctant to procure additional cargoes. On the supply side, there were available cargoes for second-half May loading from Malaysia and offers were also heard at a premium of $300/mt on a CFR basis. In Vietnam, domestic supply was gradually increasing, and importers were not rushing into spot purchase.