Alwaght- China has slashed purchase of liquefied petroleum gas (LPG) from the United States by 50 percent and turned to the West Asia for extra supplies as trade war escalates between two countries.
Consultancy IHS Markit estimates US imports fell to barely 1 million tons during the first eight months of 2018, down from about 2.1 million tons for the same period last year, said He Yanyu, Executive Director for Natural Gas Liquids, Reuters reported.
China bought nearly 3.6 million tons of US LPG in 2017, making the United States the country’s second-largest supplier of the fuel used in petrochemicals, as well as for cooking, transport and heating.
The fall came as Chinese buyers wound back US purchases of LPG amid uncertainty about the impact of buying product from the United States, said a trader who tracks the fuel.
No US LPG cargoes have landed in China since tariffs were imposed in late August, said Ong Han Wee at consultancy FGE.
“China has stopped shipping in U.S. LPG cargoes as they are now too expensive,” added a second trader who tracks LPG cargoes.
The United States last year accounted for about 20 percent of China’s total LPG imports, which are currently running at about $1 billion a month, based on Thomson Reuters calculation.
The US gap is being filled largely by Qatar, the United Arab Emirates (UAE), Saudi Arabia and Kuwait, analysts said.