Saudi Aramco Lowers Propane and Butane Prices for June Amid Shifting Global LPG Market

Saudi Aramco has announced a reduction in its official selling prices for propane and butane for June 2025, citing changes in global market dynamics. The state-owned oil giant revealed the adjustments in a statement on Thursday, signaling ongoing volatility in the liquefied petroleum gas (LPG) sector.

According to the company, the price of propane has been lowered by $10 per tonne to $600, while butane has seen a steeper decline of $20 per tonne, bringing it down to $570 per tonne. The revised rates mark a continued downward trend from May and reflect broader shifts in supply and demand across global markets.

Propane and butane—both classified as LPG—are critical to multiple industries. They are used for residential heating, as alternative vehicle fuels, and as feedstock in petrochemical production. Their respective boiling points determine their suitability for different applications, making their pricing a key factor for energy and manufacturing sectors.

Aramco’s LPG pricing is closely watched by the market, serving as a benchmark for term supply contracts from the Middle East to the Asia-Pacific region. The latest price cuts are expected to influence purchase decisions across these key markets.

The adjustments come amid a broader rebalancing of global LPG trade. High tariffs on U.S. LPG exports have led Chinese importers to scale back on American shipments, prompting a shift toward Middle Eastern suppliers. As a result, U.S. cargoes are being rerouted to Europe and other parts of Asia, disrupting previous trade flows and pressuring prices globally.

Industry analysts say the new dynamics are challenging both American shale producers and Chinese petrochemical firms, which are grappling with reduced access to competitively priced U.S. LPG. At the same time, the shift is boosting demand for alternative feedstocks such as naphtha, especially in Asia.

Middle Eastern exporters, including Aramco, are seen as strategic beneficiaries of this trade realignment. Meanwhile, buyers in countries like Japan and India are leveraging falling prices to negotiate more favorable supply deals.

With LPG prices continuing to face downward pressure, market participants are closely monitoring developments, particularly how long the current pricing environment will persist and how it might reshape long-term supply relationships.