U.S. exports of propane reached records in the first half of 2026

U.S. exports of propane hit record levels in the first half of 2026, averaging 2 million barrels a day, up 11% from the same period in 2025. Exports peaked at 2.1 million barrels a day in April, driven by rising U.S. production and growing demand from India and other South Asian countries, along with buyers looking to replace supplies disrupted from the Middle East. Propane is a byproduct of natural gas processing and oil refining, and it's used not just for home heating but also in making plastics. More U.S. production has kept prices here lower than in Asia, making American propane attractive to overseas buyers.

Trade patterns have shifted, though. China, once a major buyer, cut back sharply after imposing tariffs on U.S. propane starting in 2025. Those tariffs spiked as high as 125% before settling at 10%, and U.S. exports to China fell 19% in the first half of 2026 compared with a year earlier. A terminal expansion project in Texas, expected to finish this year, will add more export capacity, but shipping bottlenecks remain a concern. Drought tied to El Niño has lowered water levels at the Panama Canal, limiting how many ships can pass through and raising costs for propane shipped that way.

For homeowners who heat with propane, especially in rural areas without natural gas service, this growing export demand is worth watching. When more U.S. propane goes overseas, it can tighten domestic supply and put upward pressure on local prices, particularly heading into the winter heating season.