Europe's first prolonged cold spell of the season has done little to revive propane prices, as abundant supply continues to outweigh winter heating demand.
Temperatures fell to freezing across much of the continent over the past week, but northwest Europe's propane market saw only a modest uptick in liquidity and no significant price rebound. Large cargo propane ended last week at $443.50/t — about $140/t below the same period last year — marking the lowest late-November price since the pandemic. The grade's ratio to Ice Brent crude futures held steady in the mid- to high-50s, roughly 10 percentage points lower than a year ago, underscoring persistent weakness.
The price softness reflects a steady flow of strong US imports arriving in Europe since April, when the US-China tariff dispute escalated. Despite a truce agreed in late October that could redirect volumes towards Asia, trading flows have yet to shift meaningfully. Europe remains well supplied, with transatlantic arrivals on track to exceed 600,000 t in November, adding downward pressure and limiting any weather-driven support.
Spot activity picked up last week, with daily buying inquiries for December cargoes. But bids rarely exceeded $450/t, leaving assessments stuck near that level. Some late-November and early-December requirements have already been covered, reducing urgency for prompt cargoes. Expectations of continued US arrivals into early December further weighed on sentiment, while petrochemical demand remains weak.
The forward cif ARA curve reflects this caution. December swaps continue to trade above January, creating mild backwardation that signals near-term firmness driven largely by weather rather than a broader tightening of fundamentals. The structure suggests the market expects cold conditions to have only a limited and temporary impact, with supply remaining comfortable into the new year.
The cold snap has helped steady prices at the lower end of recent ranges, but with demand still constrained and imports plentiful, Europe's propane market shows few signs of breaking out of its subdued trajectory.
