Seaborne

Dorian LPG Says US Exports Drive Global LPG Supply by Sea to Increase in Q2


Dorian LPG Ltd. said global maritime supplies of liquefied petroleum gas increased in the quarter ended June 30, due to increased exports from the United States.

On the market:

“The global supply of LPG by sea increased by approximately 1.5 million tonnes in the second calendar quarter of 2021 compared to the first calendar quarter of 2021 and an increase of 6% compared to the same period of 2020, “the liquefied petroleum gas shipping company said.

“The majority of this increase came from the United States, where exports averaged 4.4 million tonnes per month in the second calendar quarter of 2021. The Middle East’s maritime LPG supply has remained relatively constant, with production cuts and Iranian sanctions remaining in place.

“Crude oil prices have risen throughout the second calendar quarter of 2021, with Brent averaging around $ 69 per barrel, up from $ 32 per barrel during the same period in 2020. Fixed prices of the Propane and butane increased as a result, however, the percentage of propane and butane to crude oil fell from the previous quarter in all major regions.

“With a higher maritime supply, imports in major consuming regions have increased especially to China, where LPG imports have increased from around 5.7 million tonnes in the first calendar quarter of 2021 to 6,” 5 million tonnes in the second calendar quarter of 2021. “

“Petrochemical margins increased throughout the first calendar quarter of 2021 and this trend continued into the second calendar quarter of 2021 as a number of facilities did not return to full operation after being shut down. in the first trimester. It was mostly in the Western Hemisphere.

“The consumption of LPG as a feedstock for petrochemicals increased in the second calendar quarter of 2021 compared to the first quarter, with propane being preferred as a feedstock for ethylene production over naphtha.

“The spread of propane-naphtha in northwestern Europe widened to – $ 90 per tonne on average in the second calendar quarter of 2021, compared to an average of – $ 23 per tonne in the first quarter.

“Towards the end of the second quarter, however, margins for steam cracked ethylene production began to decline, with the largest declines recorded in the Eastern Hemisphere.

“The Baltic VLGC Index averaged around $ 53 per tonne in the second calendar quarter of 2021, just $ 2 per tonne below the performance of the Baltic Index in the first calendar quarter of 2021.

“Currently, VLGC’s order book represents around 22% of the current global fleet. An additional 70 VLGCs, equivalent to approximately 6.2 million m3 of carrying capacity, are expected to be added to the global fleet by the end of calendar year 2023. The average age of the global fleet is now around 10 years.
Source: Dow Jones