Spot prices for cargoes of North sea propane have moved above $1,000/mt driven by cold weather in Northwest Europe and exports, according to sources.
Delivered prices for North Sea cargoes were just over $940/mt at the beginning of February, dipped to the high $920s/mt but then increased sharply to reach $1,025.5/mt Thursday, based on Platts data.
The last time CIF North Sea propane prices were above $1,000/mt was at the end of December 2010.
Cargoes of North Sea propane are used as a heating fuel during the winter in Northwest Europe, but until recently mild weather had curbed demand.
The current spell of very cold weather, however, has boosted inland consumption and increased demand for North Sea propane.
"It is definitely starting to tighten up," said one trader.
There has also been a steady stream of North Sea propane exports, mainly to the Mediterranean, resulting in less availability for the market in Northwest Europe.
