LPG Contract Price (CP)
LPG Contract Price (CP), commonly called the “Saudi CP” is the primary driver of LPG pricing in the Far East including the Philippines. It is the international price benchmark set at the beginning of each month by Saudi Arabia’s state - owned oil company Saudi Aramco.
Aramco's CPs, which set the price of LPG lifted from the Saudi ports Yanbu, Ras Tanura and Ju'aymah under term supply contracts, are closely watched by the market as they tend to set a base level for LPG pricing for most markets East of Suez.
The DOE refer to the LPG/Saudi CP and forex monthly average changes in determining/monitoring the price adjustments of LPG in the domestic market. Following the timing of the monthly changes in CP, domestic price of LPG also varies every first day of the month and remain constant throughout the whole month.
Like all other petroleum products, the Philippines has no influence over the LPG CP as the country’s domestic requirement is small versus the world demand.
For the month of September 2021, LPG Contract Price has increased by US$8.50/MT to US$ 665.00/MT, from US$ 656.50/MT last month.
International LPG Market Development
- Saudi Aramco set both its September propane and butane term contract prices at $665/mt, with propane up $5/mt from August and butane up $10/mt versus August.
- This is the fourth straight monthly increase in the CPs and also the highest since October 2014 for the propane and butane CPs, when they were set at $735/mt and $765/mt respectively, S&P Global Platts noted.
- This is also the first time since October 2018 that the Saudi propane and butane CPs were set at parity, after which propane had been at a premium to butane, reflecting healthy Chinese demand for propane to feed the growing number of propane dehydrogenation plants, while Indian demand for mixed cargoes has been fluctuating.
- The US has also been exporting more butane to Asia in recent years, adding to butane supply which normally comes from the Middle East. But the parity of the September propane and butane CPs reflected the improving demand in India, while Asia is also getting ample supply of propane from the US over the next two months.
- Supply from the Middle East for September is largely up, attributed to production at the Ras Tanura refinery, returning to normal levels following the disruptions. Operations at the 550,000 b/d plant started to resume around June 10 after the technical glitch since late-May.
- Sources also said that Indian term lifters have largely dominated term supply from the Middle East to meet demand during the pandemic. LPG imports increased almost 10% on-month to 1.414 million mt in July, PPAC data showed
- The India’s Petroleum Planning and Analysis Cell (PPAC) showed an overall increase in consumption by 4.6% on-month to 2.37 million mt in July, up for the third-straight month after hitting a 10-month low in April. LPG consumption in India is the world's second-largest LPG user after China.
- Consumption so far this year rose 4.6% compared to the same period last year as demand improvements continued to improve in recent months.
- Further on demand, Japan's total demand retreated 7.24% month on month to 794,000 mt in July, after a slight rebound in June that followed two straight months of declines.
- Propane demand slid 10.56% on the month to 627,000 mt in July, though butane demand rose 7.74% on the month to 167,000 mt, the data showed.
- Total LPG imports rebounded 5.68% on the month to 744,000 mt in July, after falling for five months in a row till June.
Domestic Price
Oil companies increased the price of LPG effective 01 September 2021 by P0.64 to P0.65/kg or about P7.04 to P7.15 per 11-kg cylinder. Auto LPG likewise increased by P0.35 to P0.36/liter.
As of 01 September 2021, household LPG in Metro Manila are estimated to range from P717.04 to P999.15 per 11-kilogram cylinder.
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Shown below are the retail prices of 11 Kg. Household LPG |
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| Year | Domestic Price |
Adjustment/Kg. Increase (-Decrease) |
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| 2020 | |||
| January | 677.00-829.00 | 7.55 | |
| February | 655.00-778.00 | -2.20 | |
| March | 611.00-795.00 | -3.90 | |
| April | 501.00-770.00 | -9.60 to -10.70 | |
| May | 536.00-854.00 | 5.80 | |
| June | 536.00-854.00 | -0.28 | |
| July | 560.00-780.00 | 0.50 | |
| August | 550.00-780.00 | 0.15 | |
| September | 560.00-720.00 | 0.15-0.18 | |
| October | 528.00-820.00 | 1.00 | |
| November | 539.00-850.00 | 3.20 | |
| December | 557.00-860.00 | 0.96 | |
| 2021 | |||
| January | 600.00-905.00 | 4.16 | |
| February | 634.00-937.00 | 2.95-3.00 | |
| March | 640.00-946.00 | 0.73-0.82 | |
| April | 605.00-784.00 | -3.30 | |
| May | 639.00-900.00 | -3.20 | |
| June | 600.00-920.00 | 2.18-2.20 | |
| July | 655.00-960.00 | 5.19-5.20 | |
| August | 691.00-997.00* | 3.27-3.35 | |
| September | 717.04-999.15* | 0.64-0.65 | |
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Note: *Prices for August are estimates |
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For more information, call the Department of Energy:
Pricing: 840-2187
LPG: 840-2130
Fuels: 840-5669
SMS: (0915) 4469421
Email: [email protected]
Website: www.doe.gov.ph