Royal Dutch Shell Plc  .com Rotating Header Image

Lloyds List: Gas Market Report

Published: Aug 06, 2007

NORTH WEST EUROPE: ANSI for August was set at $602 for propane and $594 for butane.

The price of the large propane cargoes picked up over the last week with a couple of trades concluded in the mid $620s but was seen as being selective not speculative buying. Since then buying interest has been subdued but is still seen as being there for August cargoes especially anything within the first 20 days. However, most people feel that unless the buyers for storage start to buy then prices will start to slide with a belief that September will be a more abundant month as productions start to get back to normal after the summer maintenance. A petchem company launched a tender for end August/early September arrival which was awarded to Sonatrach so we will see at least one import to the area.

Large cargo butane remains subdued with any trades being done on a very p and c basis. Most people believe that the prices should be around the $620 level but no one would gamble on this being the level at which the next published deal will be concluded.

Propane coaster market remains tight on the supply side with the restricted supply out of Tees and refineries continuing and any seller is seeking numbers in the mid $630s FOB. CIF sellers are asking numbers around the $670 level which buyers are struggling to swallow just yet. Contract cargoes are absorbing the few cargoes available as spot buying is almost non existent.

Coaster butane remains very elusive for good quality material which would command prices in the $570s FOB whilst the poorer quality cargoes are nearer to the $550s. However, it seems that the only CIF buyers at present are happy with the poorer quality and are only willing to pay in the $590s whilst the buyers of good quality (if any)would be expected to have to pay in the $610s.

MEDITERRANEAN: Refrigerated cargo: Sonatrach posted August prices for propane at $590 and the butane at $595, an increase of $30 and 28 respectively, in line with market expectations. Med continuing to be a no trade area – just bits and pieces here and there, confirming propane weakness with no real demand which should be the case for full month. Good quality butane is more in demand with steady prices. The US major sell tender (VLGC 3/1 pro/bu loading Angola 15/17) reported sold to South America.

Coaster cargo: Propane coaster market continues to be very quiet as spot demand in this period is very thin. FOB/FCA levels were assessed unchanged in the mid/high 590s and no significant transaction has been reported. Butane trading activity has been limited by tight prompt availabilities and lower Petchem and North African demand. Only 2 kt heard done FOB Lavera for August 4-10 delivery at $585. Prices increased by $15 but with Mohammedia again covered early August with a large cargo coming from Algeria, less buying interests are expected and price should stay stable.

ARABIA GULF: The Saudis posted August CPs at $580 per tonne for c3 and $605 per tonne for c4. The market thinks the numbers are still high when viewed in conjunction with the CFR prices in the Far East. Also the $25 per tonne spread between c3 and c4 was deemed too high. The August /September spread is assessed at flat to a slight contango.

FAR EAST: Crude oil prices went on a roller coaster ride this week. It initially rose to $77 per barrel end of last week from below $73.50 per barrel early last week as crude oil supplies fell in the US mid West and Shell said no firm date has been set for restoring Nigerian supplies. Crude oil prices then fell to below $75 per barrel as the stock market world wide suffered a big drop on US housing woes and credit squeeze worries. However crude prices rallied back to above $78 per barrel by mid week this week on speculation US demand will outpace supply.

A Taiwanese refiner awarded its tender to buy 11 + 11 for August 22/31 delivery Taiwan at $615 per tonne to a European major. Another Taiwanese refiner cancelled its tender to buy 11 c3 for August 17/21 delivery Taiwan as the offered prices were deemed too high.

The Chinese importers stayed out of the market as the domestic prices are still behind international price. The Japanese and Korean importers are staying on the side line in view of their comfortable inventories and perceived current high prices.

The August c3Argus Fareast Index swap went up to $616 per tonne level this week from $603 per tonne traded last week in line with the jump in crude oil prices.

MOUNT BELVIEU: Mt Belvieu prices as at August 2 2007: propane 1.2175-1.2300$per gallon; natural butane 1.4000-1.4100$per gallon; iso butane 1.4500-1.4550$per gallon; natural gasoline 1.6400-1.6450$per gallon;

ethane propane mix 0.8050-0.8100$per gallon; ethane 0.8075-0.8125$per gallon.

SHIPPING MARKET: Comments: There was more life in the VLGC market last week, and there were a few spot fixtures as evidence. There was a fairly big gap between high, mid $40s and low, mid/high $30s for the MEG/Far East voyage. The tonnage length in the beginning of August was thereby reduced, and market is probably assessed somewhere in the middle of the high and low. The Baltic Freight Index slid below the $40 mark one day and thereafter went up again. The tonnage balance in the second half of August looks healthy and once players have digested the August CP and latest crude prices, there is reason to believe freight rates may strengthen again.


Moritz Schulte – 8,200 cu m – 12 months time charter delivery Med – July – hire not reported – Mitsui

Christoph Schulte – 9,000 cu m – 12 months time charter – delivery E.O.S. – July – hire not reported – Marubeni


Merwegas – 3,200 cu m – 1,000 tonnes iso butane – Tees/Coryton – 1/2 Aug – rate not reported – Petroplus

Auteuil – 3,500 cu m – 1,200 tonnes butane -mix Fawley/ARA – 2/4 Aug – rate not reported – ExxonMobil

Gohshu – 72,000 cu m – about 35,000 tonnes propane – Yanbu/worldwide options – mid-Aug – rate not reported – Chevron

Clean River – 76,000 cu m – 43,000 tonnes LPG – Middle EastGulf/East – 11/13 Aug – high $30′ per tonne – Itochu

Gas Vision – 78,000 cu m – 44,000 tonnes LPG – Middle East Gulf/options – 12/14 Aug – $38 per tonne – Petredec

Gas Taurus – 78,000 cu m – 44,000 tonnes LPG – Middle East Gulf/East – mid-Aug – mid-$40s per tonne – Stasco

Capt Markos NL – 82,000 cu m – 44,000 tonnes LPG – Middle East Gulf/East – end Aug – rate not reported – MLG

BW Boss – 84,000 cu m – 44,000 tonnes LPG Algeria/options – 13/15 Aug – rate not reported – Totsa


Coral Meandra – 4,200 cu m – 650 tonnes RGP – Fawley/Port Jerome – 28/30 July – rate not reported – ExxonMobil, Chemicals


MC Shipping and Bear Stearns Merchant Banking have announced the signing of a merger agreement providing for the Company to be aquired by a newly formed entity controlled by BSMB. MC Shipping sharholders will get $14.25 per share, representing a total transaction value of about $284.

Fearnleys. This report may not be reproduced in part or as a whole without permission. While information is presented in good faith, Fearnleys cannot accept liability for any errors of fact or opinion or for any loss incurred by any person who may seek to rely on the information contained herein. and its sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

0 Comments on “Lloyds List: Gas Market Report”

Leave a Comment

%d bloggers like this: