LPG prices plunge on possible Israel-Iran ceasefire

: LPG
25/06/24

Global LPG prices fell by around 6pc today after Israel and Iran appeared to agree a ceasefire.

An end to the 12-day conflict would alleviate fears of supply disruptions, and LPG prices started to retreat after rising on Monday, 23 June.

The Asia Pacific Argus Far East Index (AFEI) July paper contract fell by $34.50/t to $555.50/t, and the equivalent European propane paper value fell by $33/t to $477/t.

Swap contracts, with liquidity far greater than physical trading, can be a useful indicator of global sentiment. The prompt contract, currently July, can move rapidly and accurately reflect the trajectory of physical price moves.

Some market participants are skeptical on the durability of the truce. Iran has yet to confirm its agreement.

The hostilities have endangered Iranian infrastructure, ports, terminals and facilities that could affect LPG output. There was also an implied threat from Tehran of closure of the strait of Hormuz. Either scenario would severely affect output from the region. Iran exports about 10mn t/yr of LPG, most of it to China, and 40mn t/yr passes through the strait of Hormuz, equivalent to 27pc of global seaborne exports.

Any disruption to Middle East flows would force China, the biggest LPG buyer, to seek more product from the biggest seller, the US. This would leave less product for European buyers and would necessitate higher European price premiums to compete with Asia-Pacific buyers, which typically offer better netbacks to US sellers.

By Efcharis Sgourou

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25/07/11

Canada focuses on new US deadline, diversifying trade

Calgary, 11 July (Argus) — Canadian prime minister Mark Carney reiterated his plan to diversify trade with countries "throughout the world" following another round of tariff threats, and another deadline, from US president Donald Trump. Carney's comments on social media late on 10 July came hours after Trump said Canada could expect a 35pc tariff on all imports , effective 1 August, repeating earlier claims that the northern country was not doing enough to stop fentanyl from crossing into the US. Canada has said these claims are bogus but in late-2024 still committed to spending $900bn (C$1.3bn) on border security measures over six years. "Canada has made vital progress to stop the source of fentanyl in North America," Carney wrote on X. The prime minister said he is now working to strike a new trade deal before the 1 August deadline. Trump and Carney last month agreed they would work toward a broad trade agreement by mid-July, with Canada at the time targeting 21 July to finalize a deal. The 35pc tariff would be separate from tariffs set for specific sectors, which include a 50pc tariff on copper imports. It is not clear if any imports currently covered by the US-Mexico-Canada trade agreement (USMCA) would be affected by Trump's latest tariff threats. Carney has advocated the need to shore up trade partnerships with "reliable" countries since being sworn is as prime minister in March, saying the old relationship with the US "is over". The energy-rich nation needs to build more infrastructure to unlock this potential, and with a surge in public support, is trying to entice developers with a new law to fast-track project approvals . But those are multi-year efforts and Canada is still trying to reach a deal with the US to keep goods moving smoothly. The two economies are highly integrated with $762bn worth of goods crossing the US-Canada border in 2024, according to the Office of the US Trade Representative. Canada on 29 June rescinded a digital sales tax (DST) that would have collected revenue from the US' largest tech companies, after US secretary of commerce Howard Lutnick said the tax could have been a deal breaker in trade negotiations. That show of good faith — which seemingly got nothing in return — was criticized within Canada and contrary to Carney's repeated "elbows up" mantra in the face of Trump's threats. By Brett Holmes Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Trump threatens 35pc tariff on Canada by 1 August

25/07/11

Trump threatens 35pc tariff on Canada by 1 August

Houston, 10 July (Argus) — The US will impose a 35pc tariff on all imports from Canada effective on 1 August, President Donald Trump said in a letter to Canadian prime minister Mark Carney. The 10 July letter that Trump posted on social media late Thursday noted that Canada previously planned retaliatory tariffs in response to the US' first tariff threats in the spring. He repeated his earliest justification for the tariffs - the illegal smuggling of fentanyl into the US from Canada - and said he would consider "an adjustment" to the tariffs if Canada worked with him to stop that flow. The 35pc tariff would be separate from tariffs set for specific sectors, which include a 50pc tariff on copper imports . It is not clear if any imports currently covered by the US-Mexico- Canada trade agreement (USMCA) would be affected by the new tariff threats. The Trump administration since 5 April has been charging a 10pc extra "Liberation Day" tariff on most imports — energy commodities and critical minerals are exceptions — from nearly every foreign trade partner. Trump on 9 April imposed even higher tariffs on key trading partners, only to delay them the same day until 9 July. On 7 July, Trump signed an executive order further delaying the implementation of higher rates until 12:01am ET (04:01 GMT) on 1 August. Earlier this week he threatened 50pc tariffs against Brazil for its ongoing criminal prosecution of former president Jair Bolsonaro. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

EU proposes support package for chemicals sector

25/07/08

EU proposes support package for chemicals sector

Brussels, 8 July (Argus) — The European Commission today proposed a package of measures to support the EU chemicals sector, aiming to address high energy costs, global competition and weak demand. The plan includes extending emissions trading system (ETS) compensation to more producers and simplifying fertilizer registration rules. The commission said the simplification measures could save the sector €363mn/yr. The proposals are part of a broader action plan to boost competitiveness and secure supply chains. A new Critical Chemicals Alliance will identify key production sites in need of policy support, including on trade issues such as supply chain dependencies and market distortions. The commission also pledged to apply trade defence measures more quickly and expand chemical import monitoring under an existing surveillance task force. While the commission stopped short of proposing a Critical Chemicals Act — which would legally define specific chemicals for support — it named steam crackers, ammonia, chlorine and methanol as "essential" to the EU economy. The alliance will aim to align investment and co-ordinate support, including through the bloc's Important Projects of Common European Interest (IPCEI) programme. The commission also decided on new rules legally defining low-carbon hydrogen today and said it plans to allow more state aid for electricity-intensive chemical producers by the end of the year. It also encouraged the use of carbon capture, biomass, waste and renewables. EU industry commissioner Stephane Sejourne said the action plan uses "all levers" to put the chemicals sector back on a growth track, with measures to retain steam crackers and other key chemical assets in Europe. He also highlighted efforts to secure domestic demand for "clean and made-in-Europe chemicals". The commission will align fertilizer registration rules with the EU's REACH chemicals framework, applying standard REACH provisions and streamlining the assessment of micro-organisms used in fertilizers. Officials said the changes will maintain safety and agro-economic efficiency standards while allowing a broader range of micro-organisms. For ETS indirect cost compensation, the commission plans to expand the list of eligible chemicals — including organic chemicals and fertilizers — but must first update existing state aid guidelines, a senior EU official said. By Dafydd ab Iago Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Dow to close German cracker, other assets by 4Q 2027

25/07/07

Dow to close German cracker, other assets by 4Q 2027

London, 7 July (Argus) — US chemicals firm Dow said today it will permanently close its ethylene cracker in Bohlen, Germany, and chlor-alkali and vinyl assets in nearby Schkopau, in the fourth quarter of 2027. It will close its siloxanes plant in Barry, UK, in mid-2026. "The shutdown of upstream assets in Europe will right-size regional capacity, reduce merchant sale exposure, and remove higher-cost, energy-intensive portions of Dow's portfolio in the region," the company said. The assets were included in Dow's strategic review in April. It said at the time the sites were being considered for idling or closure. The Bohlen cracker has a nameplate capacity of 540,000 t/yr of ethylene and a propylene capacity of 285,000 t/yr. It also has a butadiene extraction unit with a nameplate capacity of 105,000 t/yr. At Schkopau, Dow has a membrane cell chlor-alkali capacity of 250,000 t/yr and 740,000 t/yr of ethylene dichloride capacity. The site previously had around 330,000 t/yr of capacity for chloride monomer (VCM) production, with two lines operating at the site, but Dow closed the larger of the two lines to reduce capacity to roughly 110,000 t/yr earlier in 2024. Dow's polyethylene assets in Schkopau — a 210,000 t/yr LLD-HDPE unit and 108,000 t/yr LDPE unit — were not part of the review and will continue to operate. Dow said closure of the upstream assets would "improve our ability to supply profitable derivative demand and optimise margins". The PE units can utilise an ethylene pipeline that runs between them and Dow's storage and import infrastructure in Stade, Germany. The extended lead-time of the closures will allow Dow to wind down existing contracts and give customers time to attempt to source alternative material. Customers include the former Dow polypropylene plant at Schkopau, which it sold to Brazil-based petrochemical company Braskem in 2011 and that receives feedstock propylene from the Boehlen cracker. Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

Drilling slowdown undermines Trump’s energy dominance

25/07/07

Drilling slowdown undermines Trump’s energy dominance

New York, 7 July (Argus) — US shale producers expect to drill fewer wells in 2025 than they initially planned to at the start of the year, dealing a potential blow to President Donald Trump's goal of unleashing energy dominance. Almost half of the executives quizzed by the Federal Reserve Bank of Dallas in its second-quarter 2025 energy survey have scaled back their anticipated drilling in response to lower crude prices. The decline was most notable among the large operators — or those with output of at least 10,000 b/d — that now account for about 80pc of total US production, according to the bank. The anonymous survey, which gauges the pulse of the shale heartland, has become an outlet for industry insiders to vent their growing frustration at the Trump administration, and executives from exploration and production (E&P) firms offered a withering criticism of the president's tariff policies and unrelenting push for lower oil prices that have contributed to an industry-wide slowdown. "It's hard to imagine how much worse policies and DC rhetoric could have been for US E&P companies," one unidentified executive wrote. "We were promised by the administration a better environment for producers but were delivered a world that has benefited Opec to the detriment of our domestic industry." The survey found that activity contracted slightly in the three months to the end of June, with firms becoming increasingly uncertain about the outlook. "The key point from this survey release is that conditions deteriorated for companies in the oil and gas sector this quarter, with survey responses pointing to a small decline in overall activity as well as oil and gas production," Dallas Fed senior business economist Kunal Patel says. The deteriorating outlook for shale comes as the Opec+ group has stepped up efforts to unwind past output cuts, which might help it to regain market share. But the White House argues that efforts to remove permitting obstacles will help the homegrown oil industry to thrive over the longer term, bolstered by Trump's One Big Beautiful Bill that paves the way for expanded oil and gas leasing. Still, that did not stop executives in the latest Dallas Fed survey from complaining that Trump's " Liberation Day chaos " has jeopardised the sector's prospects, and recent volatility is inconsistent with the president's "Drill, baby, drill" mantra. One drew attention to calls from some within the White House for a price target of $50/bl. "Everyone should understand that $50 is not a sustainable price for oil," the executive said. "It needs to be mid-$60s." Firms were also asked about how their production would change at lower prices. A slight decline was expected if oil prices hovered around $60/bl over the next 12 months, while a significant pullback was anticipated if oil retreated as far as $50/bl. Steel yourself About a quarter of producers estimated that tariffs have increased the cost of drilling and completing a new well by as much as 6pc. And about half of the surveyed oil field services firms expect a recent increase in US steel import tariffs to result in a slight decline in customer demand in the next year. "Despite efforts to mitigate their impact, the scale and breadth of the tariffs have forced us to pass these costs on to our customers," one services firm executive wrote. "This comes... when the economics of oil and gas production are already challenged due to the dynamics of global oil supply and demand." On top of this, firms expect challenges related to the huge volumes of water produced alongside oil in the top Permian basin of west Texas and southeastern New Mexico to act as a constraint on drilling in the next five years. "Water management continues to disrupt plans and add significant costs," one executive said. By Stephen Cunningham Send comments and request more information at feedback@argusmedia.com Copyright © 2025. Argus Media group . All rights reserved.

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LPG prices plunge on possible Israel-Iran ceasefire

Related news posts

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Canada focuses on new US deadline, diversifying trade

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