Conference: Russia’s LPG market 2022

Date: December 01–02, 2022

Current challenges to LPG market discussed at St Petersburg conference on 1-2 Dec

The present and future of the liquefied gas market of the Russian Federation was discussed on December 1-2 at the traditional already XIII International conference «Russia’s LPG Market 2022». The event is organized by MAXConference in St. Petersburg with Gazprom Gazonefteprodukt Holding as its general partner.

The lifting of the «covid» restrictions allowed more than 200 delegates from various Russia’s regions, as well as from Kazakhstan, Belarus, Azerbaijan, Armenia, Tajikistan and China to take part in the conference. The delegates represented LPG manufacturers and suppliers, owners of gas stations, STS, specialized LPG transshipment terminals, petrochemical companies, transport firms and analytical agencies.

The first session of the event, as a prolog of the two-day discussions, was devoted to the results of the year, the balance of LPG production and sale, pricing, trade policy of companies, the exchange market of LPG, plans of companies. It was attended by key players in the domestic market: Russia’s Energy ministry, Gazprom Gazonefteprodukt Holding, Sibur, Lukoil, Spimex, Ufaoil.

The “discussion baton” was passed then to the companies of the retail segment. The participants noted that this year the ratio of the cost of LPG and gasoline in retail dropped to a minimum value of 45%, which was reflected in the increase in demand for LPG in the segment of autogas. Representatives of OMT-Consult, GNP network of gas stations, YUTA-AvtoGaz, TC Yugnefteprodukt, Phoenix NP, Transgaz, GP Vympel, Smolensk Gas Company told about the specifics of the regional LPG markets, prospects for the sale of LPG as an automobile fuel.

The conference participants continued to discuss the topic of «autogas» in a session dedicated to gas filling infrastructure. It became clear that the issues of replacement and functioning of gas filling stations in the conditions of sanctions, as well as the problems of converting cars to gas-fuel mode, the development of the HBO market were the most acute. Representatives of domestic NII Gazeconomika, Kraigaz, the Union of Gas Engine Industry Enterprises, Hexagon Composites Rus, RsvComposite shared their vision of the situation.

The second day of the conference was about LPG exports and logistics solutions. The speakers assumed that, despite the global fuel volatility, the total volume of LPG consumption in the world is growing, the main increase in LPG production is in North America. There is also an increase in LPG production in the Middle East and the Asia-Pacific region. At the same time, China remains the main consumer of LPG, where petrochemical capacities continue to develop actively, experts noted.

Analysis of international LPG markets and export trends was presented by Thomson Reuters, Facts Global Energy, IG Petromarket, Vector and Gayrat – 82 companies. Logistics and infrastructure solutions for LPG export supplies were highlighted in the presentations of Vostok LPG, Castor, United Petrochemical Company, Xuan Yuan Industrial Development Co. and Sirius.

LPG rail transportation market was in the focus of the session’s reviews along with the problems of the rolling stock fleet designed for LPG transportation and storage, the impact of rail transportation conditions on the LPG market. The heads of TESOL GROUP, Mosregiongaz, Container RemService revealed the problems in this area. The speakers noted that, despite the changes in logistics, LPG shipments are increasing, but the rolling stock available for transportation is decreasing. The shortage of wagons emerged earlier than everyone predicted. The production of new tanks has begun, but the growing needs of the market will not be able to close the current volume of tank production, the shortage of the fleet will increase, experts say.

We hope that next year the situation will stabilize and there will be no shocks that will prevent us from gathering LPG market professionals again to discuss what the future holds for this fuel.