Propane $605 and Butane $585, up $55 from January
A factor of around 70 won per kilogram of domestic LPG price in March occurred after the 8th consecutive month increase
[투데이에너지 조대인 기자] In February, when the cost of introducing LPG, such as ship freight and insurance premiums, rose to more than $60 per ton, international LPG prices rose slightly lower than this by an average of $55.
As the prospect of strengthening eco-friendly policies after the inauguration of the U.S. Biden government emerged, the increase in demand for crude oil, which is expected to increase due to economic recovery, such as reduction of U.S. crude oil and gas supply due to regulations on the petroleum industry, and countermeasures for economic stimulus, as well as oil prices, is a factor in the rise of international LPG prices. This is because it is giving rise to the expectation that it will work.
However, restrictions on the rise in oil prices are limiting the rise in international LPG prices due to concerns about delays in demand recovery for crude oil due to the spread of the coronavirus strain and the possibility of increasing production of OPEC+.
On the 31st, LPG importers 2 such as SK Gas and E1 announced on the 31st that they received notification that the international LPG price in February, supplied from Saudi Arabia’s Aramco, increased by 55 dollars per ton for propane to 605 dollars, and butane also increased by 55 dollars to 585 dollars.
It is analyzed that the domestic LPG price hike in February was slightly over KRW 65 to 70 per kg due to the increase in international LPG prices, which averaged US$55 per ton.
As of the 29th, it is feared that the rising exchange rate to 1,114.60 won, a 10.6 won increase from the previous day, will be a burden on the domestic LPG price.
The exchange rate, which was traded at an average of 1,152.44 won per dollar in October last year, rose by 31.2 won to 1,121.24 won in November, and then fell 24.71 won to 1,096.53 won in December. It is showing an upward trend.
Of course, how the exchange rate fluctuates until the 25th of next month will affect whether it will act as a factor for raising domestic LPG prices or as a factor limiting the extent of the increase.
When these factors are put together, the domestic LPG price in March is expected to rise to around KRW 70 per kg.
Considering these factors, LPG importers such as SK Gas and E1 are interested in how to determine the factor of domestic LPG price in February, around 150 won per kg.
This is because the factors that increase the domestic LPG price in March may also change depending on the extent of the domestic LPG price hike in February.
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