Register with us today

and in less than 60 seconds continue your access to:Latest news headlinesAnalytical topics and featuresCommodities videos, podcast & blogsSample market prices & dataSpecial reportsSubscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Please Note: Platts Market Center subscribers can only reset passwords via the Platts Market Center

Enter your Email ID below and we will send you a link to reset your password.


  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you a link to reset password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber, to reset your password go to the Platts Market Center to reset your password.

In this list
Natural Gas | Oil

India resumes LPG spot imports on low prices, demand recovery

Commodities | Energy | Oil | Crude Oil | Refined Products | Coronavirus

Crude throughput hindered on reduced refinery runs

LNG | Natural Gas | NGL

Platts LNG Alert

Commodities | LNG | Natural Gas | NGL | Financial Services | Infrastructure & Utilities

Gas Storage Outlook Conference, 18th Annual

Bunker Fuel | Oil | Refined Products | Fuel Oil | Gasoline | Shipping | Marine Fuels

Security incident occurs on oil tanker off UK: sources

India resumes LPG spot imports on low prices, demand recovery

Singapore — Indian state-owned refiners Indian Oil Corp. and Bharat Petroleum Corp. have emerged to buy spot LPG for September and October delivery after a two-month hiatus following the drawdown of high inventories and as spot prices were more attractive than term contracts, market sources said.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

BPCL on Sept. 4 awarded a tender to buy a 44,000 mt evenly split cargo comprising 22,000 mt of propane and 22,000 mt of butane for Oct. 7-25 delivery into Visakhapatnam and Haldia at a premium of around $28-$29/mt to the Saudi Aramco October Contract Price for propane and butane on a CFR basis, a source with knowledge of the matter said.

BPCL was understood to have finished covering its requirements for October delivery, and might buy a spot cargo again for November, the source added.

Prior to BPCL's purchase, Indian Oil Corp. had emerged twice in the spot market for September and October delivery cargoes. The most recent purchase was for two 44,000 mt evenly split cargoes for delivery over Oct. 11-20 into Ennore/Haldia and Oct. 21-31 into Vizag/Haldia, done at a premium of $30-$35/mt to Saudi Aramco October CP, on a CFR basis, S&P Global Platts reported previously.

The earlier purchase was for one 44,000 mt evenly-split LPG cargo for H2 September delivery, done at a premium of around low-$30s/mt to the Saudi Aramco CP, on a CFR basis.

DEMAND RECOVERY, LOWER SPOT PRICE

Market sources said the resumption of spot LPG imports came amid an increase in domestic demand, which is typically stronger over October-December.

Demand typically rises ahead of the Hindu festival of Diwali, which falls on Nov. 14 this year.

India's LPG demand had shown a recovery in July, at 2.27 million mt, up 9.4% from June when it touched the lowest monthly level in a year at 2.075 million mt, data from the country's Petroleum Planning & Analysis Cell showed.

The demand recovery followed government approval on July 8 to extend provision of free LPG cylinder refills for Pradhan Mantri Ujjwala Yojana, or PMUY, beneficiaries.

Yet other sources said the easing of port congestion at Indian import terminals, caused by heavy imports in March and April, helped encourage spot imports.

One other reason for the increase in spot imports is that Indian refiners, who have term contracts with Middle Eastern suppliers and traders, are opting for spot over optional term cargoes due to the lower price, a source with an Indian refiner said.

Indian refiners term up to 75%-80% of total imports, with the remainder sought on the spot market when demand rises.

"Usually when demand is up, we get optional cargoes from term contract. Now we are going for spot instead of optional term," the source said.

BPCL's purchase price at CP plus $28-$29/mt equates to about $14/mt discount to the CP on a FOB basis, the source said. This is lower than an optional term cargo, the source said. "Going to the market to buy gives us a better price," he added.

MIDDLE EAST LPG DISCOUNTS TO CP NARROW

With the resumption of spot imports from India, the biggest outlet for Middle Eastern LPG, the FOB AG propane and butane discounts have shrunk.

Kuwait Petroleum on Sept. 2 sold a 44,000 mt evenly split LPG cargo for Sept. 27-28 loading at a discount around mid-teens to the Saudi Aramco October CP, on a FOB basis, Platts reported previously. Prior to that, Kuwait Petroleum Corp sold an evenly-split cargo for Sept. 19-20 loading at a discount in the low-$20s/mt to the Saudi Aramco CP on a FOB basis.