LPG Special Report: Challenging freight

LPG Special Report: Challenging freight, margin dynamics ahead after record flows

Global LPG markets, after record arrivals in August, are entering a period of challenging dynamics, including softening demand in parts of Asia and divergent appetites for propane and butane
Surging LPG supplies are colliding with ample naphtha availability, pressuring LPG’s competitiveness, though strong demand from India and recovering US-China flows offer support
Already robust VLGC freight rates pose a potential upside risk, influenced by waypoint and port congestion, incentivising reshuffling and longer routing, ultimately increasing fleet inefficiencies

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Global LPG markets, after record arrivals in August, are entering a period of challenging dynamics, including softening demand in parts of Asia and divergent appetites for propane and butane
Surging LPG supplies are colliding with ample naphtha availability, pressuring LPG’s competitiveness, though strong demand from India and recovering US-China flows offer support
Already robust VLGC freight rates pose a potential upside risk, influenced by waypoint and port congestion, incentivising reshuffling and longer routing, ultimately increasing fleet inefficiencies