LPG Prices Rise Due to 'Ukraine Invasion'... Supply Price Up 60 Won per Kg

Sharp Rise in International Oil Prices and High Exchange Rates
International LPG Prices Also Increase

[Image source=Yonhap News]

[Asia Economy Reporter Moon Chaeseok] Due to Russia's invasion of Ukraine, international liquefied petroleum gas (LPG) prices have soared, leading to an increase in domestic LPG supply prices in March.

Domestic LPG importers E1 and SK Gas announced on the 1st that they will raise the domestic LPG supply price by 60 KRW per kg this month. E1's March household and commercial propane price is 1,387.8 KRW per kg, and industrial propane is 1,394.4 KRW per kg. Butane is priced at 1,710.38 KRW per kg (998.86 KRW per liter). SK Gas will raise household and commercial propane to 1,389.36 KRW per kg, and industrial propane to 1,489.36 KRW per kg. E1 explained, "We raised the domestic supply price in March after comprehensively considering international LPG prices, exchange rates, and consumer burden."

LPG importers set their monthly supply prices based on the international LPG contract price (CP) determined by Saudi Arabia's state-owned oil company Aramco, reflecting exchange rates, various taxes, and distribution costs. LPG, which is separated and extracted from natural gas or produced during crude oil refining, usually follows international oil prices. Considering the approximately 20-day transportation time to import LPG products from the Middle East, the domestic supply price for this month is determined based on the previous month's international LPG price. The international LPG price for February, which is reflected in this month's domestic price, was 775 USD per ton for propane, up 35 USD from the previous month, and 775 USD per ton for butane, up 65 USD. Additionally, the exchange rate exceeding 1,200 KRW per USD also influenced the LPG price increase.

International LPG prices rose by an average of 132 USD in March, with propane reaching 895 USD per ton and butane 920 USD per ton. This is why there are forecasts that domestic LPG prices will rise further next month. LPG is called a "common people's fuel" as it is used for heating in rural areas and homes where city gas is not supplied, as cooking fuel for small businesses such as restaurants and street vendors, and as fuel for taxis. The recent rise in LPG prices inevitably places a burden on the economy of ordinary people.

This content was produced with the assistance of AI translation services.