Executive Summary:
Infrastructure: Escalating US-China trade tensions have disrupted one of the fastest-growing lanes for the propane trade, and Canada is taking advantage.
Exports: Total US NGL exports declined 10% W-o-W, driven by a 52% drop in ethane exports.
Rigs: The total US rig count increased during the week of Aug. 3 to 526. Liquids-driven basins increased by 1 rig W-o-W from 397 to 398.
Flows: US natural gas volumes averaged 70.4 Bcf/d in pipeline samples for the week ending August 17, up 0.1% W-o-W.
Calendar: Purity Product Forecast, Ethane S&D, Propane S&D – 8/25 | Plant Data Updated 8/27
Infrastructure:
Escalating US-China trade tensions have disrupted one of the fastest-growing lanes for the propane trade, and Canada is taking advantage.
US waterborne propane exports to China have dropped sharply since April, when China imposed a 125% retaliatory tariff in response to a US tariff hike of 145% on Chinese imports. East Daley warned at the time of the risk to the booming propane trade. China had been the second-largest destination for US propane in 2024, taking nearly one-fifth of volumes, but the tariff shock has made US barrels uneconomic for China’s propane dehydrogenation (PDH) plants.
Tanker-tracking data from Vortexa shows Canada has stepped into the gap. Chinese buyers now take most of Canada’s seaborne propane exports, after sending negligible volumes there earlier this year (see figure). While the Canada-China trade link has strengthened, total US propane exports remain resilient. Cargoes originally bound for China are being redirected to Japan, South Korea and emerging Asian markets, avoiding an outright drop in export volumes but contributing to volatile very large gas carrier (VLGC) freight rates.
The realignment highlights both opportunity and risk. Canada could cement a premium position in the Chinese market through long-term contracts, while US exporters reduce single-buyer exposure but face more complex freight and margin dynamics. In a loosening market for LPG dock slots, the reshuffling raises questions over infrastructure utilization and pricing power. East Daley continues to forecast robust US propane exports in 2025, but with a fundamentally different destination mix as global trade flows adjust to a new geopolitical reality.
Exports:
Total US NGL exports declined 10% W-o-W, driven by a sharp 52% drop in ethane exports, while LPG exports increased 10.4% W-o-W due to higher loadings at Marcus Hook and Galena Park.
The stee drop in ethane exports was primarily due to a 70.5% decline at ET Nederland and Orbit. This reduction reflects a return to more typical ethane export levels after the previous week’s elevated volumes.
As additional LPG dock capacity comes online but remains underutilized, watch for flexible facilities shifting optimization toward ethane exports.
Rigs:
The total US rig count increased during the week of Aug. 3 to 526. Liquids-driven basins increased by 1 rig W-o-W from 397 to 398.
- Permian – Midland (-2): Vital Energy, ExxonMobil
- Bakken (-1): Kraken Resources
- Anadarko (+2): Roberson Oil, WSR Operating
- Powder River (+1): Devon Energy
- Uinta (+1): FourPoint Resources
Flows:
US natural gas volumes averaged 70.4 Bcf/d in pipeline samples for the week ending August 17, up 0.1% W-o-W.
Gas basin samples increased 0.4% W-o-W to 44.1 Bcf/d. The Haynesville sample increased 0.4% to 10.7 Bcf/d, and the Marcellus+Utica rose 0.3% to 32.4 Bcf/d.
Calendar:
