|Published : 12 Oct 2016, 14:20:36|
New LPG era in Asia
SINGAPORE: Liquefied petroleum gas (LPG), long a niche product used in petrochemicals, as well as for cooking and outdoor heating, is entering a new era as a wave of supply from the US shale boom cuts prices, spreading its usein emerging markets, a major shipper said.
Production of LPG, known better as propane or butane, has traditionally been dominated by the Middle East, while Japan has been the biggest buyer, where it is used largely as a petrochemical feedstock.
Now, the market is undergoing fundamental change as the US shale oil revolution, in which LPG is produced as a by-product, has propelled the United States to the top of the production table, and emerging markets have overtaken Japan as the biggest buyer.
"In 2013, the U.S. accounted for only 15 per cent of global supply volumes, whereas today they account for over 31 per cent of global supply volumes. The U.S. is now the single largest LPG exporting nation," Ted Young, Chief Financial Officer at Dorian LPG, told Reuters in an interview for its Global Commodities Summit, reports Reuters.
New York-based Dorian LPG, which has a market capitalization of $363 million, says it owns 22 Very Large Gas Carriers (VLGC), making it one of the world's biggest shippers of the fuel.-Asfar