Saudi Aramco set its February propane term contract price at $605/mt, up $55/mt from January, and butane CP at $585/mt, up $55/mt, the company said Jan. 31.
The increases in the CPs were slightly above traders expectations of $600/mt for propane and $580/mt for butane.
The February CP propane swap closed Jan. 29 at $596/mt, with butane $21/mt below that.
The higher February CPs were driven by healthy heating demand in North Asia amid a severe winter, which is expected to remain harsh in Japan's northern areas through February, as well as robust requirements from Chinese PDH plants which are operating at high rates to capture healthy margins.
This is the eighth consecutive monthly increase in the propane CP, and the seventh rise in a row for butane.
Aramco had set the propane CP for February 2020 at $505/mt and butane at $545/mt, S&P Global Platts data showed.
Aramco's CPs -- which set the price of propane and butane lifted from the Saudi Arabian ports of Yanbu, Ras Tanura and Ju'aymah under term supply contracts -- are closely watched by the market as they tend to set a base level for pricing in most markets east of Suez.
