Singapore (Platts)--26Jun2007

Rising LPG supply from the Middle East will outpace growth in global
demand leading to a bigger surplus of LPG, a senior analyst at energy
consulting firm Purvin & Gertz said Tuesday.

     "A significant world LPG supply build is under way," Purvin & Gertz
senior vice president Ken Otto said at the company's annual Asia LPG seminar
in Singapore.

     "Year 2007 is turning out to be a unique year. We're not seeing as much
surplus as we expected," he said. "[But] strong annual increases in global LPG
supplies are expected through to 2010." 

     Global LPG supplies will rise by 46 million mt between 2006 and 2012 to
around 250 million mt in 2012, Otto said. About 55% of the projected increase
will be LPG production from non-associated gas, most of which will come from
the Middle East, he said.

     The developments of long-term pipeline delivery of natural gas and rapid,
export-oriented expansions of LNG capacity in the Middle East will boost the
region's supply of LPG, Otto said.

     "LPG supply has caught up with demand in the east of Suez region after
many years of being supply-short," Otto said.

     Meanwhile, global demand will rise, although high prices are slowing
growth in developing markets.

     "Growth in global supply could significantly impact market conditions and
pricing over the next two to three years," he said. 

--May Tham, may_tham@platts.com