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LPG (Liquefied Petroleum Gas) (PG)

Liquefied petroleum gas — propane and butane — is the bridge between the natural gas complex and the petrochemical chain, and China is its largest import market. The Dalian PG contract, launched in 2020, has rapidly become Asia's reference for LPG pricing. For traders seeking a young, volatile, event-rich energy contract with clean specifications, PG offers some of the best risk-reward dynamics on the exchange.

Contract Specifications

Specifications are reference values compiled from exchange publications. Margins and price limits adjust dynamically — the exchange's latest announcements prevail.

What Moves LPG (Liquefied Petroleum Gas)

• Crude oil and propane spreads. LPG is produced in refining and gas processing, so its price is anchored to crude — but the propane crack (CP) and US Mont Belvieu export arb set the marginal economics. When US propane exports surge, Chinese import parity shifts and PG reprices.
• PDH plant economics. China's massive propane dehydrogenation (PDH) fleet turns propane into propylene. PDH margins are the single biggest demand driver: when propylene prices rally, PDH plants run flat-out and import LPG aggressively; when margins compress, feedstock demand withers.
• Winter heating demand. LPG doubles as a heating and cooking fuel across Asia. Q4 seasonal restocking in China, Japan and South Korea produces some of PG's strongest sustained trends of the year.
• MB and CP contract pricing. Saudi Aramco's monthly CP (contract price) announcement and Mont Belvieu spot moves are the twin external anchors. CP day is a scheduled volatility event that Dalian traders mark on the calendar.
• Freight and BDTI rates. LPG is a seaborne trade, and VLGC freight rates feed directly into Chinese import costs. Freight spikes during canal disruptions or fleet bottlenecks lift Dalian prices independent of supply.

Why Traders Watch It

PG is a young contract with explosive moves around CP announcement days and PDH margin swings. Daily price limits can trap you during gap opens driven by overnight US propane moves — the night session covers part of the US day but not all of it. Margins are dynamic and the exchange has raised them during volatility episodes; size positions for that reality. Liquidity is deepest in the front three months; deferred months carry wide spreads that make stop placement treacherous.

Trading PG on XS Select

All XS Select evaluations include PG and every other major Chinese commodity contract, on real Wenhua Finance market data with institutional liquidity. Commission is 2x the exchange standard (open and close) — replicating professional conditions.