Saudi LPG Prices Up After Iran Standoff Boosts Crude Prices

Saudi Aramco and Kuwait Petroleum Corporation (KPC) raised their common April contract prices for liquid petroleum gas (LPG) for propane by 24 dollars a ton to 530 dollars a ton and for butane by 39 dollars a ton to 545 dollars a ton, the Middle East Economic Survey reported Monday.

The Cyprus-based weekly publication said that the increase was due to the recent sharp rises in crude oil prices to above 60 dollars a barrel for benchmark West Texas Intermediate (WTI) because of increasing tension between Tehran and London over the capture of 15 British naval personnel, and the move to tougher sanctions against Iran over the nuclear issue.


The crude price rally has boosted the LPG spot market, with Saudi Aramco understood to have sold a 24,000-ton cargo of butane for petrochemicals feedstock at 560 dollars a ton in early April, the MEES report added.

Meanwhile, Saudi Aramco officials believe that Middle Eastern LPG is expected to grow substantially in the next few years, even though rising regional demand for petrochemicals production will probably absorb much of the increase.

DPA