Chaos in global energy markets following the launch of Operation Epic Fury is expected to drive record demand for U.S. exports of propane and butane, analysts said Monday.
Following a military strike by the U.S. and Israel that killed Iran’s supreme leader Ayatollah Ali Khamenei and approximately 40 senior officials, Iran launched missile attacks on Saudi Arabia’s largest oil field and targeted civilian and energy infrastructure in at least nine countries including Saudi Arabia, Qatar, Kuwait, Bahrain, Oman and Jordan.
Propane and butane, together called liquified petroleum gas or LPG, are one of the largest U.S. export products in dollar terms. The U.S. produced more than 10 billion gallons of propane in 2025, about 70% of which was exported to foreign markets, energy department data shows.
LPG has been among the fastest growing U.S. exports in the last two decades, with total overseas shipments in 2024 valued at approximately $29 billion, about the same as soybeans, soymeal and soy oil, which together are the nation’s largest agricultural export category in dollar terms, Census Bureau data shows.
Analysts predict a sustained spike in demand for non-Middle Eastern energy, including U.S. LPG, which is typically a mix of 80% propane and 20% butane used by consumers and businesses across a number of industries that include agriculture, plastics production, petrochemicals, home heating and cooking.
Before the recent conflict with Iran began, Saudi Aramco had already shut down its 450,000-barrel-per-day Juaymah LPG export terminal, one of the world’s largest, due to an accident on Feb. 23 expected to keep the facility offline for more than a month. LPG buyers around the world were already scrambling to find supplies even before Iran shut down the Strait of Hormuz to vessel traffic.
Saudi Aramco is reportedly considering alternative export routes, including pipelines to the Red Sea that would allow shippers to bypass the Strait of Hormuz, according to Price Futures Group commodities analyst Phil Flynn.
U.S. consumers and companies will be mostly unaffected by surging global LPG prices because domestic inventories of both propane and butane are at levels well above average for this time of year, said Eric Smith, associate director at the Tulane Energy Institute in New Orleans.
In the week ended Feb. 23, the energy department reported propane inventories were at a record-high 62.6 million barrels for this time of year.
“We export massive amounts of LPG and the recent events will likely have little to no impact on our domestic propane and butane prices,” Smith said. “We can expect world LPG prices to rise, so our exporters will probably do well in this market environment. In the longer term, maintaining the Fifth Fleet at bases in Bahrain makes it very costly for the United States to police the Strait of Hormuz,” Smith said.
Since 2007 when the shale oil revolution began, the U.S. LPG export sector has seen 18 consecutive years of growth, with most of the shipments going to Asian nations where the two gases are used primarily to manufacture plastics and petrochemicals.
U.S. propane exports averaged about 1.8 million barrels per day in 2025, up slightly from the year prior, while overseas shipments of normal butane reached nearly 500,000 barrels a day in the year, with both at record highs.
“Texas, especially the Mt. Belvieu area near Houston, is the epicenter of world LPG exports,” Smith said.
LPG terminals located along the Texas coast, with daily loading capacity of 2.2 million to 2.4 million barrels per day, currently account for 85% to 90% of total U.S. LPG exports. The remaining U.S. LPG exports are shipped from Marcus Hook, Pennsylvania and Ferndale, Washington.
Although Asian demand softened in mid-2025 due to uncertainty over trade policies, U.S. LPG exports to Europe hit all-time highs during the year while shipments to Africa, primarily Egypt and Morocco, surged fourfold.
