CFR Far East

The CFR Far East market strengthened amid a sharp rally in crude oil prices and tightening supply/demand fundamentals. The Japan Index stood at $889.75/mt for propane and $939.75/mt for butane, while the China Index was assessed at $978.75/mt for propane and $1,028.75/mt for butane. WTI crude oil prices surged later last week. Against this backdrop, CFR Far East quotations in the paper market rose sharply, widening the spread between CFR Far East quotations and the CP to more than $200/mt. In propane discussions, a 23,000mt propane cargo for first-half October delivery was concluded between traders, while an importer in China was also heard to have purchased a full propane cargo. In discussions for cargoes containing butane, Pertamina in Indonesia conducted a buy tender for October delivery. However, participation was limited, prompting the company to reissue the tender. Supply/demand fundamentals for 44,000mt 50:50 cargoes tightened further, with KPC's sell tenders attracting participation from a large number of players.

FOB Middle East

Even as the closure of the Strait of Hormuz continues, some Middle East gas suppliers appeared to be continuing to transfer cargoes outside the Persian Gulf. Meanwhile, buying interest for 44,000mt 50:50 cargoes remained strong. KPC's two delivered-basis sell tenders conducted last week were believed to have attracted participation from a large number of players, including importers from Southeast Asia. Award levels were also seen to be gradually rising. The tender that closed on Sep 8 for a propane-rich cargo for second-half September delivery was reportedly awarded at a premium in the $400's/mt to the September CP, while the tender that closed on Sep 10 for a 44,000mt 50:50 cargo for second-half September delivery was heard to have been awarded at a premium of more than $500/mt to the September CP.

Asia Pressurized Market

The pressurized cargo market sharply moved up due to tight supply. In the FOB South China market, sellers were limited while active buyers were observed. Later last week, some cargoes were reportedly traded at a premium of $420/mt to the CP and offers for second-half September loading were only heard at a premium of $450/mt to the September CP. In Vietnam, importers were trying to secure spot cargoes due to a supply shortage, but available cargoes were few. Offers went up to a premium of $400-500/mt to the September CP, but buyers were apparently unable to pay this price.