US Gulf VLGC rates plunge to 2-month lows

: LPG
23/01/03

Freight rates for very large gas carrier (VLGC) shipments out of the US Gulf coast fell sharply over the final two weeks of 2022, reaching the lowest since late October, as demand fell on a narrower propane arbitrage to Asia and reduced wait times at the Panama Canal.

From 21-30 December, the Houston-Chiba VLGC rate fell by 30pc to $146/metric tonne, and the Houston-Flushing VLGC rate fell by 38pc to $86/t. Over the same period, the Argus-assessed time charter equivalent rates on the routes, which represent earnings or losses for a shipowner, fell by 39pc to $78,676/d and by 47pc to $90,383/d, respectively.

The arbitrage to ship propane from the US Gulf coast to Asia has narrowed over the past month because of higher prices in Mont Belvieu, Texas. Late last week, January AFEI/LST paper was trading between $207-213/t, while February paper was trading at $176/t, compared with $247/t and $209/t, respectively, in early December.

Shorter wait times at the Panama Canal have also pressured freight rates, as open VLGCs positioned in the Pacific basin have been able to ballast more quickly to the US Gulf. This morning, wait times for a VLGC without a reservation to transit the canal were two days for both northbound and southbound, down from 2022 highs in the mid-20s early last month. At 2:30pm ET, just one VLGC was waiting to transit northbound through the canal into the Atlantic basin, per Vortexa data.

The drop in US Gulf coast VLGC rates comes after more than three straight months of continuous gains that saw rates reach seven-year highs. Between 22 August and 2 December, the Houston-Chiba VLGC rate rose to $208/t from $93.50/t, and the Houston-Flushing VLGC rate rose to $138/t from $53.50/t.

By Michael Connolly

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25/12/16

Viewpoint: European HVO prices unlikely to ease in 2026

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EU to dilute Ice vehicle phase out: German lawmaker

25/12/15

EU to dilute Ice vehicle phase out: German lawmaker

Brussels, 15 December (Argus) — The European Commission is likely this week to dilute its plan to phase out sales of new internal combustion engine (Ice) vehicles by 2035, according to a lawmaker. "The ban on internal combustion engines is history," said Manfred Weber, the chair of parliament's largest centre-right group EPP. He said the commission will present on 16 December an automotive package that "will revise the CO2 standards for cars, reversing the disastrous ban on internal combustion engines". Weber is a member of Germany's CDU/CSU party, as is commission president Ursula von der Leyen. German chancellor Friedrich Merz has called on the EU to allow the sale of vehicles with highly efficient combustion engines, plug-in hybrids and range-extender EVs beyond 2035. This had faced pushback, with more than 150 European e-mobility firms requesting the commission "stand firm" on its 2035 target. An EU official said the target is now likely to be for a 90pc GHG reduction from 2035 for new vehicles. "As it stands the targets for 2030, but also 2035, are not realistic," said Sigrid de Vries, director general of the European Automobile Manufacturers' Association (ACEA). "Even with a 90pc target [for reducing GHG by 2035], make no mistake, that will be very, very challenging." The European motor industry has already flagged the possibility of huge fines for manufacturers should they fail to meet existing emissions targets, which are for a 15pc reduction by 2029 compared with a 2021 baseline, and a 55pc reduction from the same baseline in 2030-34. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Aramco Jafurah project still in commissioning: Resend

25/12/15

Aramco Jafurah project still in commissioning: Resend

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Supply surplus masks regional market tightness: IEA

25/12/11

Supply surplus masks regional market tightness: IEA

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Saudi Arabia brings giant Jafurah gas project onstream

25/12/03

Saudi Arabia brings giant Jafurah gas project onstream

Dubai, 3 December (Argus) — Saudi state-controlled Aramco has begun production from the first phase of the giant Jafurah natural gas project, the finance ministry said late on Tuesday. In its 2026 budget statement, the finance ministry listed the phase one start-up as one of Saudi Arabia's achievements in 2025. It didn't specify a date, but it is likely to have been in the past few days. It said production began at 450mn ft³/d, which is two and a half times the rate at which Aramco had long projected. With in-place reserves of 229 trillion ft³ (6.87 trillion m³) of raw gas and 75bn bl of condensate, Jafurah is the largest unconventional gas field in the Mideast Gulf and represents a major pillar of Aramco's ambitious gas expansion plans. Aramco has yet to announce the start up. It previously said it expects to lift sales gas output ꟷ or net production ꟷ to 650mn ft³/d by the end of 2026 in phase one. It is unclear if this stronger-than-anticipated start-up rate could translate into a higher end-2026 target. A second phase is scheduled to come on stream in 2027, to lift production to 2bn ft³/d by the end of the decade, Aramco has said. Aramco has an ambitious programme to expand gas production by more than 80pc by the end of the decade, relative to a 2021 baseline of 9.2bn ft³/d. This implies output of at least 14.7bn ft³/d by 2030, with Jafurah delivering more than one-third of the increase. Jafurah will also produce about 420mn ft³/d of ethane and 630,000 b/d of NGLs and condensate as by-products by 2030. The ethane and NGLs will be sent to the Riyas fractionation plant, which is being built as part of the phase two development. The condensate will be sent to the Juaymah terminal, where Aramco is expanding its storage and export facilities. By Nader Itayim Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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