Romania's growing autogas market boosts 2023 imports

Demand for autogas is expected to continue rising in the country as it maintains a discount to competing motor fuels

Romania's autogas consumption increased last year as more drivers were attracted by its lower price compared with gasoline and diesel, helping to lift imports to the country by over a quarter on the year.

Autogas sales in the country rose by 10,000-30,000t on the year to 270,000-300,000t as a result of its lower price against other motor fuels. "The ratio of autogas to gasoline prices fell below 50pc last year from 60-65pc owing to rising global gasoline and diesel prices," a Romanian trader says.

Romanian autogas prices stood at 3.27-3.35 lei/litre (71-73¢/l) last week, while gasoline prices were Lei7.12-7.15/l ($1.50/l), putting the former at 47pc of the latter. This compares with autogas' cost of Lei3.91-3.98/l in April 2023, and gasoline at Lei6.63-6.69/l, with a ratio of 59-60pc.

The country's autogas demand could have been even stronger last year had it not been for a fire at the Flagas refuelling station in Crevedia, near Bucharest, in August. Immediately after the accident, a special commission consisting of firefighters, police, an environmental body and tax authorities was formed to carry out inspections at the country's autogas stations, resulting in many being closed. "The commission would close a fuelling station for a slightest non-compliance, so some retail operators shut down their fuelling stations before it arrived," a market participant says.

Romania has more than 1,000 autogas refuelling sites. But around 300 stations are reported to have closed since September 2023 following the incident. This resulted in sales dropping in September-December last year compared with the same period in 2022, according to local market participants.

The growth in autogas sales over the whole of last year boosted Romania's LPG imports to around 353,000t compared with 278,000t in 2022, Vortexa data show. All of the country's LPG deliveries were to its sea ports of Midia, Mangalia and Galati, as rail shipments from Russia transiting Ukraine, which had been 2,000-3,000 t/month, halted after the war in Ukraine began in late February 2022.

Imports were also supported by cuts to domestic output and an increase in overland exports. Exports rose by about 5,000–10,000t to 330,000–340,000t in 2023, according to market participants, with most of this supported by rising shipments to Ukraine, growing by 45,600t to 235,600t.

Romania's LPG imports from Egypt doubled to 104,200t, Vortexa data show, with most of this supplied by trading firms Naftomar and Evicor. Arrivals from Turkey grew by 51,300t to 69,600t, mostly delivered by Turkish distributors Aygaz and Milangaz. More Kazakh LPG arrived from Georgia's Batumi port, rising by 14,800t to 27,600t, to partially offset the loss of supply from Russia's Taman terminal after exports halted in May 2023. LPG arrivals from Algeria and the US also increased last year (see table).

Gassing up

Romania's autogas demand should be on course to continue expanding this year, with autogas prices at around an 80¢/l discount to gasoline at the beginning of April. The government raised autogas excise duty again from 1 January, to around Lei874/t ($191/t). But it also increased the duty on gasoline to Lei2.02/l and on diesel to Lei1.85/l, and will do so again from 1 July to Lei2.38/l and Lei2.18/l, respectively, while the rate on autogas is expected to remain unchanged.

Autogas sales in the country are expected to increase to 280,000-320,000t this year from 270,000-300,000t in 2023 because of lower excise tax on LPG compared with gasoline and diesel, according to traders. Exports should stabilise while domestic output will increase as technical issues at the Rompetrol refinery are resolved, they say.

Romania LPG demand by sector 2022