Oct CP Sees Notable Declines
The October propane CP was $495/mt, down $25/mt MOM. At the same time, the October butane CP was $475/mt, down $15/mt MOM.
Most market participants adopted bearish attitudes to the international crude oil market, giving thin support to the international spot market. Meanwhile, the Middle East and the U.S. simultaneously competed for the Indian market. The demand from India exerted notable impacts on the Middle East, and purchases of Middle Eastern goods by India were mostly settled based on CP. At this critical moment of India’s semi-annual tender, the October CP price recorded a substantial reduction.
The overall dealings for October cargos were fairish. Moreover, the demand for LPG in China remained high, supporting the market sentiment, and that in India also performed well. Besides, the LPG supply in Middle East remained tight, giving support to the international LPG prices. Besides, the international freight remained high. Overall, the expectations for October CP were relatively high. However, CP, as the contract price between Saudi Aramco and its contracted buyers, inherently reflects a degree of intentional positioning. In order to retain Indian clients, the Middle East ultimately announced a price that deviated significantly from prior market expectations.
The notable decline in CP exerted bearish impacts on market sentiment. China’s LPG prices were stable-to-dipping during the National Day holiday, so most market participants adopted wait-and-see attitudes to the market. Therefore, the overall market trading was sluggish, weighing on CP.
Forecast: The international crude oil prices see notable fluctuations, giving thin support to the international LPG market. Moreover, most market participants may adopt wait-and-see attitudes to the market due to the uncertainties in tariff policy and shipping policies, weighing on the spot trading. Besides, China’s LPG demand may be lower than expected, so it is predicted that the November CP may continue to decline.
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