U.S. propane exports reached 2 million barrels per day (b/d) in the first half of 2026, which is 11 percent higher than the same period in 2025. This increase is attributed to high propane production and changes in trade flows, particularly an increase in exports to India and other South Asian countries. In April 2026, propane exports hit a record 2.1 million barrels per day.
Reasons for the Increase in Propane Exports
The increase in propane production in the United States, which is a byproduct of natural gas processing and crude oil refining, has rapidly risen over the past 10 years. This increase in production has led to lower propane prices in the U.S. compared to Asia, resulting in record exports.
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Changes in Trade Flows
U.S. propane exports surpassed 2 million barrels per day in April 2026 for the first time, driven by increased demand from petrochemicals and importers' need for alternative sources due to disruptions in transportation from the Middle East. The expansion project by Enterprise, expected to be completed this year at the Houston Ship Channel and Nederland terminals, will increase export capacity by 300,000 barrels per day.
However, changes in trade flows are also observed. In February 2025, China imposed a 10 percent tariff on propane imports from the U.S., leading to a decrease in demand for U.S. propane exports. China's tariffs increased to 125 percent in April 2025 and were reduced to 10 percent in May 2025. U.S. propane exports to China decreased by 28 percent in 2025 compared to 2024.
Export Limitations and Their Impacts
The continued growth of propane exports may be affected by export capacity limitations. Additionally, drought conditions in the Panama Canal related to the El Niño climate phenomenon are exacerbating current propane export limitations. Low water levels in the Panama Canal have restricted the number of vessels that can pass through the canal daily and increased the effective costs associated with using the canal.
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