Purvin & Gertz says Middle East LPG exports declining

March 21, 2001
Uncertainty about liquefied petroleum gas supplies exists in many parts of the world, with Middle Eastern LPG exports declining while Far Eastern LPG demand is growing, particularly in China and India, S. Craig Whitley, senior principal of Purvin & Gertz, said Wednesday at an LPG seminar.


Paula Dittrick
OGJ Online


THE WOODLANDS, TEX., Mar. 21�Uncertainty about liquefied petroleum gas supplies exists in many parts of the world with Middle Eastern LPG exports declining while Far Eastern LPG demand is growing, particularly in China and India, S. Craig Whitley, senior principal of Purvin & Gertz, said Wednesday at an LPG seminar.

"We really have a 200 million metric ton international marketplace now," Whitley said of figures from 2000, adding North America was the world's largest LPG market with 59 million tonnes/year.

Asia consumed 55 million tonnes/year in 2000 and is expected to overtake the North American market by 2005. Worldwide LPG demand is expected to be 237 million tonnes/year in 2005.

Purvin & Gertz forecast Asian demand at 69 million tonnes/year compared with a North American demand of 67 million tonnes/year demand projected for 2005.

Middle Eastern LPG export volumes are dropping because of growing demands in the Middle East for petrochemical feedstocks, Whitley said.

Many diverse market conditions are affecting LPG trade and pricing, Whitney said. The region of the world east of the Suez Canal historically has had surplus LPG and has been a net exporter to the region west of the canal.

But high LPG demand growth in the Far East along with additional petrochemical demand in the Middle East transformed East-of-Suez into a net importer of LPG last year.

"This tighter East-of-Suez LPG market condition is putting upward pressure on global prices," for LPG, Whitley said.

Purvin & Gertz forecast that this pattern will continue until 2004-05 when additional LPG supplies will be available to make East-of-Suez a net exporter again.

Ken Otto, Purvin & Gertz vice-president, also said Middle East exports will drop significantly this year and next year.

LPG consumption as a chemical plant feedstock will rise sharply because of a new wave of olefin plants in Saudi Arabia, Otto said, adding that trend could spread to other countries.