SINGAPORE: Asia will be importing record volumes of LPG this year. The fuel is in demand to make petrochemicals used in protective gear against coronavirus. Demand has also risen among households for cooking.
Asia would buy 67-69.5 million tonnes of LPG this year, surpassing last year’s record, a 1 to 3 per cent increase on 2019 import volumes. Supplies could be affected due to the demand, more so as Europe steps up LPG purchases for heating in winter.
“We expect (LPG) import demand to increase in 2020 over 2019 with stronger demand in both residential and petrochemical sectors,” said Rui Hou, research analyst, Wood Mackenzie. Around 33 million tonnes of LPG have already been imported in H1, 2020.
Asia would get some 52 per cent of its LPG supplies this year from the Middle East, 35 per cent from the US and the rest from countries like Canada and Australia, said He.
There is growing demand for LPG as a cooking fuel in India and Indonesia as more people stay at home due to lockdowns and the fear of coronavirus. India – Asia’s second biggest importer of LPG – is expected to buy a record 15.8 million tonnes of LPG this year, a 9 per cent rise from last year. Its imports had surged 16 per cent in H1, 2020 compared to the same period last year after the government said it would provide free LPG fuel for cooking for three months until June.
“In general, we should continue to see strong demand from India but maybe after a slight slowdown as stocks are absorbed,” said Alexander Booth, head of research at data intelligence firm Kpler.
Indonesia is Asia’s fifth-largest LPG importer. Its imports are expected to hit 6.1 million tonnes this year, a 7 per cent rise from 2019. Demand in the rest of Asia is largely being driven by good petrochemical demand, primarily to satisfy the explosion in global personal protective equipment requirements