China-Operated Ship Transports US Ethane To India For First Time
China’s Satellite Chemical Co. is the operator of the very large ethane carrier and its voyage to Dahej appears to be a cargo resale.
A Chinese-operated ship that had exclusively transported US ethane to the Asian nation is now en route to India with a cargo for the first time, following trade tensions between the world’s two biggest economies.
The STL Qianjiang is signaling Dahej on India’s west coast, according to ship-tracking data compiled by Bloomberg. The vessel loaded at Nederland terminal in Texas operated by Energy Transfer LP, data from Vortexa Ltd. show.
China’s Satellite Chemical Co. is the operator of the very large ethane carrier and its voyage to Dahej appears to be a cargo resale, said Samantha Hartke, an analyst at Vortexa. It’s the second China-operated tanker en route to the South Asian nation this month after loading in the US, she added.
The STL Qianjiang is signaling Dahej on India’s west coast.
The niche petroleum gas, which is used as a building block for making plastics, has been swept up in the trade war between China and the US, snarling flows. Satellite Chemical is particularly exposed to the dispute, relying primarily on American ethane to feed its large Chinese processing facilities.
Most ethane deals are long-term contracts, meaning “buyers are required to take the shipments they agreed to, no matter what’s happening in the market,” said Adrian Calcaneo, global research lead for natural gas liquids and naphtha at OPIS. It’s up to buyers to “figure out how to use or resell it,” he added.
There were offers to resell China-bound cargoes in the spot market last week, said traders who asked not to be identified because the matter is sensitive. One possible purchaser could be Reliance Industries Ltd., they added. Dahej is regularly used by ethane buyers, including the private oil refiner.
Satellite Chemical and Reliance Industries didn’t immediately respond to emails seeking comment.
There are signs of cooling tensions between the world’s two biggest economies, but major questions remain. President Donald Trump said a trade agreement with China has been completed after recent talks, but US Commerce Secretary Howard Lutnick said he didn’t expect a written version to be released. That means it could be tough to know specifics of the deal.
