MARKETS: Liquid rocket propellant index edges higher

(SpaceEnergy) The SEI Liquid Rocket Propellant Index edged marginally higher in the week ending 18 September, as firmer kerosene and methane costs, linked to war in the Middle East, offset a sharp retreat in hydrogen.

The SEILRPI increased to 109.37 from 109.25 a week earlier. The kerosene index (KI) rose 1.33% week on week to 108.22, extending its increase since 12 June to 17.54%.

The methane index (MI) gained 1.93% to 101.70. It has been comparatively stable in recent weeks, standing just 1.08% above its 12 June level.

The hydrogen index (HI) moved sharply in the opposite direction, falling 4.5% to 125.37. The decline partly reversed the previous week's surge but left HI 30% above its 12 June reading of 96.21.

Oil and refined-product markets remained tight during the week. The International Energy Agency said on 18 September that benchmark oil prices had resumed an upward trend as Middle East disruption continued to restrict regional exports.

“If Gulf supplies remain constrained in the coming months and commercial inventory buffers continue to deplete rapidly, higher prices and further demand reductions may be required,” the IEA said.

The agency's September Oil Market Report said Gulf refined-product and LPG exports in August remained almost 60%, or 3.7m barrels/day, below February levels. Gulf diesel and gasoil exports were just over a quarter of their pre-war level.

Russian refining disruptions added to pressure on the wider fuels complex. In a 17 September analysis, the IEA said Russian refinery throughput had fallen to 3.8m barrels/day in June, its lowest level in more than 20 years, while diesel production was estimated to have declined nearly 30% year on year.

UBS Chief Investment Office also highlighted the elevated energy environment, noting that “Brent crude oil remains above USD 100 per barrel”, while stressing that restoration of disrupted energy flows or a diplomatic agreement could ease prices.