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Korean LPG Industry Down Depsite Record Sales

By February 13, 2017 at 7:02 am
LPG Gas (Photo : Getty Images)

Korean domestic LPG sales have reached sales at an all time high last year but that doesn't mean that all is well for the industry. The country's liquefied natural gas industry is still on the decline despite the record sales of the LPG industry. According to Korea Economic Daily, The number of LPG fueled vehicles which is the country's core consumer base has declined by more than 90,000 units last year. This indicates the collapse of the industry's core consumer base which accounts for the majority of the LPG industry's revenue and subsequent decline.

E1 is the second largest LPG importer in Korea. But they too have suffered the declining trend of the industry. The importer has suffered its deficit last year which is a first for the company in seven years. The reason for the decline is primarily due to the deterioration of its subsidiary.

According to the Korea National Oil Corp, domestic LPG gas sales reached 9,387,000 million tons last year. This is an increase of 20 percent from 7,794,000 million tons from a year ago. It is also a higher figure than the previous record of 9.29 million tons sold in 2009.

The record breaking sales were driven by the surge in LPG sales for petrochemical use. Sales for the petrochemical use rose by 88 percent year on year to 3,313,000 million tons from 1,764,000 million tons.

But despite the record breaking sales for LPG, the industry as a whole is still down. LPG vehicles which amounts to the biggest contributor for LPG declined by more than 5 percent from 3,715,00 million tons to 3,515,000 million tons. In addition, LPG sales for household and commercial use has remained stagnant.

Meanwhile the LPG industry is concerned about the high volatility of LPG sales for petrochemical use. But as of now, it may be their only saving grace to keep the industry afloat. 

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