Saudi Aramco And KPC Keep LPG Prices Unchanged For July

VOL. XLV

No 27

8-July-2002

SAUDI ARABIA

Saudi Aramco And KPC Keep LPG Prices Unchanged For July

Saudi Aramco and Kuwait Petroleum Corporation (KPC) announced to customers on 30 June their LPG contract prices for July, rolling over the June formulas of $225/ton for propane and $215/ton for butane. The July prices reflect bidding for Saudi Aramco’s usual three spot tenders during the previous month, each for 8,500-12,500 tons of propane and butane, to be loaded at Ras Tanura or Yanbu': T1 for loading 1-10 July, T2 for loading 11-20 July, and T3 for loading 21-31 July. The lack of pricing changes reflects the continuation of the predominant spot market forces from May into June – modest demand recovery in Asia and price support from the crude market (MEES, 3 June).

Purvin and Gertz anticipated the July pricing rollover in its June Middle East LPG Market Overview report, saying that Middle East producers were comfortable with current prices given market conditions, but would not find lower returns acceptable. The report says that many Asian LPG buyers still have an overhang of stocks, although recent buying of butane by China has given prices a lift. The report concludes: “We generally expect that LPG prices in the region will remain stable during the next several months. Prices through September should not vary more than $5/ton from the present values. We expect that the normal seasonal price patterns will dominate later in the year, and that contract prices will increase to $255/ton for propane and $245/ton for butane by December.”

Saudi Aramco/KPC LPG Prices

($/Ton)

Date of						Date of								Date of
Change		Propane		Butane		Change			Propane		Butane			Change		Propane			Butane
2000	1 Jan		256.00		251.00		2001	1 Jan		335.00		320.00	2002		1 Jan		227.00	205.00
	1 Feb		270.00		270.00			1 Feb		350.00		315.00			1 Feb		220.00	185.00
	1 Mar		325.00		325.00			1 Mar		330.00		295.00			1 Mar		215.00	180.00
	1 Apr		300.00		305.00			1 Apr		275.00		240.00			1 Apr		215.00	185.00
	1 May		255.00		255.00			1 May		275.00		230.00			1 May		230.00	210.00
	1 June		270.00		270.00			1 Jun		285.00		235.00			1 Jun		225.00	215.00
	1 July		295.00		298.00			1 Jul		270.00		230.00			1 Jul		225.00	215.00
	1 Aug		295.00		300.00			1 Aug		240.00		215.00
	1 Sep		295.00		295.00			1 Sep		230.00		215.00
	1 Oct		325.00		325.00			1 Oct		240.00		235.00
	1 Nov		345.00		345.00			1 Nov		235.00		232.00
	1 Dec		335.00		335.00			1 Dec		210.00		205.00