Our assessment for last week's daily Mont Belvieu propane and butane in USD/mt (2.1% and 2.5% down respectively on the weekly average):
LPG Butane prices closed by about 4% lower, closing at 445.6 USD/MT against the previous week's close of 464.5 USD/MT. Propane prices followed the same trend and closed lower by closing at about 3% lower at 436 USD/MT against the previous week's close of 451 USD/MT. This makes it the second week LPG prices in closing lower, even as the weather gets colder and fuel demand increases.
LPG prices may have fallen due to a cut in fuel demand from China; China had informed Saudi to cut down on supplies for the month of December due to a drop in demand from COVID-19 lockdowns. Also, Europe now appears to have enough fuel, meaning that fears of oil and gas shortages are no more; this is likely to push prices down. The increasing sourcing of Oil and gas from Latin America, the Middle East and the US is a relief for the market.
The COP27 summit ended on a good note for countries pushing for Energy transition relief. COP27 will go down in history as the UN climate change conference where the Loss and Damage fund was agreed. See link for details: https://www.chathamhouse.org/2022/11/cop27-what-was-achieved-and-what-needs-happen-now
Local LPG prices in Nigeria
On the local side, the Naira/USD Foreign Exchange rate at the black market seems to have returned closer to previous levels, meaning that local prices could return to an upward trend if international prices go up. Last week as prices remained at 12.45 Million Naira per 20MT ( a little lower than the previous week's high) or lower, although more LPG cargoes flooded the market at the end of the week. Prices are expected to dip a little further this week.
LPG retail prices at the LPG plants should remain within the same prevailing levels; between N9,000.00 to 10,000.00 nationwide.