Track Liquefied Petroleum Gas (LPG) Price Trend Historical and Forecast

Executive Summary

The global Liquefied Petroleum Gas (LPG) market witnessed pronounced price corrections through 2025, driven largely by oversupply conditions, subdued seasonal demand, and declining crude oil benchmarks. For the quarter ending September 2025, LPG prices declined across most major regions, including North America, Asia-Pacific, and Europe, reflecting elevated inventories, weaker downstream consumption, and constrained export arbitrage.

In North America and APAC, price indices posted double-digit quarter-over-quarter declines as export volumes softened and surplus availability weighed heavily on spot markets. Europe experienced comparatively modest price movement, supported by logistical constraints and early seasonal restocking, although abundant global inventories continued to cap upside potential.

Across regions, easing crude oil prices lowered LPG production cost trends, further limiting price support. Demand from petrochemical sectors such as PDH units, blending applications, and residential consumption remained muted for most of the summer period. While early autumn restocking is expected to provide some stabilization, near-term forecasts indicate continued range-bound behavior unless inventory normalization and stronger trade flows emerge.

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Introduction

Liquefied Petroleum Gas, comprising primarily propane and butane, remains a critical energy and petrochemical feedstock globally. Its pricing dynamics are closely tied to crude oil movements, refinery and gas-processing output, seasonal heating demand, blending requirements, and international trade flows.

Throughout 2024 and 2025, LPG markets have experienced heightened volatility amid geopolitical disruptions, shifting trade patterns, evolving tariff regimes, and fluctuating freight conditions. As the market moved into 2025, oversupply replaced earlier tightness, leading to sustained price pressure across key consuming regions.

Global LPG Price Overview

Globally, LPG prices trended downward through mid-to-late 2025, following the sharp corrections already observed in the second quarter. The key drivers shaping the global market included:

Persistent oversupply from the United States and the Middle East
• Declining crude oil prices following OPEC+ output increases
• Weak seasonal demand during the summer off-season
• Limited recovery in petrochemical and blending consumption
• Freight volatility and constrained arbitrage opportunities
International trade flows were heavily impacted by shifting arbitrage economics, particularly as Asian buyers favored Middle Eastern cargoes over U.S. barrels, diverting volumes back into domestic markets and increasing regional stockpiles.

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LPG Price Data Overview

Quarter Ending September 2025

Region Price Index QoQ Change Average Price Key Market Basis

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North America -13.45% USD 6.43/MT Domestic Average

APAC (China) -12.34% USD 568.33/MT CIF China

Europe (Germany) -1.00% USD 1,053.67/MT Hamburg FD

Regional Market Analysis

North America

In North America, LPG prices recorded one of the steepest declines globally during the quarter ending September 2025. The U.S. LPG Price Index fell by 13.45 percent quarter over quarter, reflecting a structurally oversupplied domestic market.

High inventory levels, coupled with reduced export demand, exerted sustained downward pressure on both propane and butane prices. Lower crude oil futures softened LPG production costs, limiting any upward price momentum. Domestic spot prices remained under pressure as storage levels stayed well above seasonal averages.

Procurement behavior among buyers remained conservative. Industrial consumers delayed purchases amid expectations of further price softness, while blending demand remained weak ahead of pre-winter stockpiling. Export frictions, including port delivery delays and logistical inefficiencies, further elevated domestic availability and constrained outbound flows.

Despite reduced run rates at certain processing facilities, supply tightening failed to materialize meaningfully. Near-term forecasts suggest modest additional downside risk unless export volumes recover or inventory drawdowns accelerate heading into winter.

Asia-Pacific

The Asia-Pacific LPG market, particularly China, experienced significant price corrections during the same period. The LPG Price Index in China declined by 12.34 percent quarter over quarter, driven primarily by an influx of imported cargoes from the Middle East and the United States.

Average butane prices settled at approximately USD 568.33 per metric ton, reflecting subdued demand from PDH units and blending sectors. Elevated inventories discouraged restocking activity, while thin downstream margins delayed procurement decisions.

Production cost trends eased marginally as crude oil prices declined, lowering exporter cost bases and reinforcing bearish pricing sentiment. Freight volatility affected landed cost competitiveness, although it failed to offset the broader oversupply environment.

Looking ahead, price forecasts point toward a gradual recovery into autumn as seasonal restocking begins. However, persistent inventory overhangs and cautious buyer sentiment are expected to cap any sharp rebound.

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Europe

Europe displayed comparatively resilient pricing dynamics, although overall market sentiment remained cautious. In Germany, the LPG Price Index declined by around 1 percent quarter over quarter, with average prices near USD 1,053.67 per metric ton on a Hamburg delivered basis.

While seasonal demand remained weak through much of the summer, logistical constraints played a larger role in shaping prices. Elevated Rhine river transport costs and congestion at Northern European ports increased inland freight expenses, partially offsetting global price weakness.

Arbitrage opportunities from the ARA region and Hamburg remained capped due to abundant global inventories. However, early signs of butane blending recovery prompted selective pre-season procurement by refiners, supporting demand expectations modestly.

Despite tightening forward contango and renewed bidding interest in large propane cargoes, high exporting inventories and limited arbitrage economics continued to restrain import-driven price support. The near-term outlook suggests overall price softness, with localized differentials driven primarily by logistics rather than supply shortages.

Historical Quarterly Review

During the first quarter of 2025, LPG markets experienced tight supply conditions driven by winter demand, strong exports, and weather-related disruptions. Prices surged early in the quarter before softening toward March as heating demand waned and exports slowed.

In the second quarter of 2025, prices declined sharply across regions. Oversupply, high inventories, reduced petrochemical consumption, and easing crude oil benchmarks drove double-digit declines in North America and APAC, while Europe remained range-bound amid logistical constraints.

By the third quarter of 2025, bearish fundamentals dominated. Seasonal off-season demand, inventory builds, and subdued trade flows reinforced price pressure globally.

Production and Cost Structure Insights

LPG production costs are heavily influenced by upstream crude oil prices, natural gas processing economics, and refinery output. Throughout 2025, OPEC+ production hikes and declining crude benchmarks reduced feedstock costs, enabling producers to maintain aggressive pricing strategies.

Lower manufacturing costs supported export competitiveness but also intensified price pressure in destination markets already grappling with surplus availability. Freight costs and logistics emerged as key differentiators, shaping regional price spreads and procurement timing.

Procurement Outlook and Buyer Behavior

Procurement strategies across regions remained highly cautious during 2025. Buyers prioritized inventory drawdowns, delayed spot purchases, and favored short-term contracts amid uncertain demand recovery.

As markets approach the winter season, restocking activity is expected to increase gradually. However, procurement decisions will remain closely tied to inventory levels, freight economics, and crude oil price movements. Buyers are likely to continue leveraging price forecasts and real-time market intelligence to optimize purchasing windows.

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Frequently Asked Questions

What caused LPG prices to decline in 2025

Prices fell primarily due to oversupply, high inventories, weaker seasonal demand, and declining crude oil prices that reduced production costs.

Why did North America experience sharper price declines

The U.S. market faced reduced export demand, elevated domestic inventories, and logistical frictions that increased local availability.

Why were APAC prices under pressure

Surging imports, weak PDH and blending demand, and high inventory levels weighed heavily on Asian markets, particularly China.

Why did Europe show more price stability

Logistical constraints, transport disruptions, and selective pre-season restocking helped offset global oversupply pressures.

What is the near-term LPG price forecast

Prices are expected to remain range-bound with modest downside risk until inventories normalize or seasonal demand strengthens materially.

How ChemAnalyst Supports LPG Market Participants

ChemAnalyst provides comprehensive, real-time intelligence across the global LPG value chain. Buyers, traders, and procurement teams rely on ChemAnalyst for accurate price tracking, weekly market updates, and detailed explanations behind price movements.

Through expert analysis, ChemAnalyst delivers forward-looking price forecasts, production cost assessments, and supply-chain risk monitoring, including plant shutdowns, logistics disruptions, and trade-flow shifts. With analyst teams and port-level intelligence across major trading hubs worldwide, ChemAnalyst empowers decision-makers to optimize procurement timing, manage volatility, and maintain competitive advantage in dynamic energy markets.

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This release was published on openPR.