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Business Recorder
5 days ago
- Business
- Business Recorder
Global LNG: Asian spot LNG prices inch up as hot weather boosts cooling demand
LONDON: Asian spot liquefied natural gas (LNG) prices edged higher this week as a heatwave in Japan and North Korea spurred cooling demand, while industrial demand in China remained subdued. The average LNG price for August delivery into north-east Asia was at $12.90 per million British thermal units (mmBtu), up from $12.70/mmBtu last week, industry sources estimated. The price for September delivery was estimated at $12.70/mmBtu. 'Prices have risen this week, supported by a heatwave in north-east Asia. Seoul recorded its hottest day since 2018 and stocks are being drawn down in both South Korea and Japan to meet stronger cooling demand,' said Martin Senior, head of LNG pricing at Argus. At least two Atlantic basin carriers have diverted away from Europe to Asia since the start of the month and a further two Qatari carriers have changed course from Europe to Asia as well, Senior said. Meanwhile, demand in South Asia and China remains muted with average cooling demand for the time of year and subdued industrial demand, given production prices and inflation numbers that have been published this week, said Klaas Dozeman, market analyst at Brainchild Commodity Intelligence. Dozeman said that import tariffs 'and the fluid situation around them could influence industrial demand over the coming weeks'. Global LNG: Asian spot prices fall on weak demand and rising supply In Europe, the gas market is stabilising. 'Gas prices may be finding a floor for summer. Europe needs to keep up sufficient competition to keep pulling in cargoes to refill its storage ahead of winter, even with the slight easing of regional targets to 80% from 90% before,' said Alex Froley, senior LNG analyst at data intelligence firm ICIS. There is the potential for some minor short-term bullishness if heatwaves continue in East Asia and if Japan and Korea's competition with Europe to secure fuel for summer power generation spikes, Froley said. However, fundamentals are becoming a little easier, with the second half of the year set to see an extra 7 million tons per annum (mtpa) coming on stream from the second phase of Plaquemines in the United States, as well as 14 mtpa from LNG Canada, he added. S&P Global Commodity Insights assessed its daily North West Europe LNG Marker (NWM) price benchmark for cargoes delivered in August on an ex-ship (DES) basis at $11.572/mmBtu on July 10, a $0.440/mmBtu discount to the August futures price at the TTF hub. Argus assessed the price for August delivery at $11.670/mmBtu, while Spark Commodities assessed it at $11.639/mmBtu. The U.S. arbitrage to north-east Asia via the Cape of Good Hope continues to point to Europe, while the arbitrage via Panama continues to point to Asia for the sixth week running, said Spark Commodities analyst Qasim Afghan. In the LNG freight market, Atlantic rates recorded the largest week-on-week decline since January and were assessed at $31,750/day on Friday, while Pacific rates decreased marginally to $38,750/day, Afghan added.
Business Recorder
13-06-2025
- Business
- Business Recorder
Global LNG: Asian spot prices gain on geopolitical tensions, rising temperatures
SINGAPORE: Asian spot liquefied natural gas (LNG) prices saw gains this week as rising temperatures in the northeast part of the region led to some pick-up in demand, and as escalating geopolitical tensions in the Middle East raised concerns about supply disruptions. The average LNG price for July delivery into north-east Asia was at $12.60 per million British thermal units (mmBtu), up from $12.30/mmBtu last week and its highest levels since early April, industry sources estimated. The average price for August delivery was estimated at $12.70/mmBtu. Following Israel's attack on Iranian military and nuclear targets, Iran showed interest in taking revenge to these assaults, expanding the geopolitical premium, said Klaas Dozeman, market analyst at Brainchild Commodity Intelligence. 'For gas and LNG, the real risk would be to disrupt Qatar's LNG exports for example via the Strait of Hormuz. Given earlier military threats, this still seems far away, at least for now.' Key exporter Qatar sends almost all of its LNG through the strait. Global LNG: Asian spot prices flat as weak demand, rising Europe supply caps gains Meanwhile, increased South Korean appetite helped to lift prices, as well as incremental demand from Taiwan and China ahead of the cooling demand season, said Martin Senior, head of LNG pricing at Argus. Many parts of China are experiencing above-seasonal average temperatures, which may increase gas-for-power demand through to end-June, while Japan is expecting a 70% probability for above-average temperatures until the end of the month, said Rystad Energy, citing Japan's Meteorological Agency. In Europe, S&P Global Commodity Insights assessed its daily North West Europe LNG Marker price benchmark for cargoes delivered in July on an ex-ship basis at $11.895/mmBtu on June 12, a $0.445/mmBtu discount to the July gas price at the Dutch TTF hub. Spark Commodities assessed the price for July delivery at $11.815/mmBtu, while Argus assessed at $11.95/mmBtu. 'An open inter-basin arbitrage as well as strong Egyptian demand has increased competition for Atlantic basin cargoes for European buyers,' said Senior of Argus. 'One carrier diverted in the mid-Atlantic to Asia, and the vast majority of west African loadings so far this month have headed to Asia, showcasing the open arbitrage.' Egypt has reached agreements with several energy firms and trading houses to buy 150-160 LNG cargoes to meet power demand. Meanwhile, the U.S. arbitrage to northeast Asia via the Cape of Good Hope increased this week and is now only marginally pointing towards Europe, while the arbitrage via Panama continues pointing to Asia for a second week, said Spark Commodities analyst Qasim Afghan. In LNG freight, Atlantic rates rose for the first time in almost six weeks to $33,000/day, while Pacific rates held steady at $20,750/day, he added.
Business Recorder
30-05-2025
- Business
- Business Recorder
Global LNG: Asian spot prices flat as weak demand, rising Europe supply caps gains
SINGAPORE: Asian spot liquefied natural gas (LNG) prices were flat this week after three weeks of gains, as low demand from Asian buyers and increased supply in Europe capped gains. The average LNG price for July delivery into north-east Asia was at $12.40 per million British thermal units (mmBtu), industry sources estimated. Despite extremely weak production at Malaysia's Bintulu export terminal, which had been undergoing maintenance and delaying shipments, demand in Asia has also been soft with limited appetite this week, said Martin Senior, head of LNG pricing at Argus. 'Prices (are) still out of reach of price sensitive buyers in Asia, with limited requirements posted this week,' he said. Buying interest seems to be stemming primarily from trading houses and portfolio majors, added Masanori Odaka, senior analyst at Rystad Energy. 'If prices fall another $1/mmBtu, then we will see interest from some Asian buyers,' he said, adding that while the arbitrage for U.S.-sourced LNG to Asia is closed this week, factoring in full shipping, the arbitrage for Nigeria supply to Asia is open. S&P Global Commodity Insights assessed its daily North West Europe LNG Marker price benchmark for cargoes delivered in July on an ex-ship basis at $11.211/mmBtu on May 29, a $0.52/mmBtu discount to the July gas price at the Dutch TTF hub, with ample waterborne LNG cargoes and pipeline supply easing sentiment. Global LNG: Asian spot LNG prices rise to two-week high amid renewed demand Argus assessed the price for July delivery at $11.30/mmBtu, while Spark Commodities assessed the June price at $11.175/mmBtu. 'Improving renewables supply and recovering pipe-gas flows from Norway to the continent worked in tandem with an influx of LNG to meet the current demand across Europe,' said Aly Blakeway, manager of Atlantic LNG at S&P Global Commodity Insights. 'For now, European demand remains relatively sluggish with procurements of LNG and the pace of injections seeing a relative slowdown on the week.' Meanwhile, the U.S. arbitrage to northeast Asia via the Cape of Good Hope decreased this week, but still pointed towards Europe, said Spark Commodities analyst Qasim Afghan. The U.S. arbitrage to northeast Asia via Panama closed out for the first time in over three weeks, and is now also marginally pointing to Europe. In LNG freight, Atlantic rates dropped for a fourth straight week to $29,500/day on Friday, while Pacific rates held steady at $20,750/day, he added.
Business Recorder
16-05-2025
- Business
- Business Recorder
Global LNG: Asian spot LNG prices rise slightly on US-China tariff truce
LONDON: Asian spot liquefied natural gas (LNG) prices rose slightly for the second week running amid a slight uptick in demand as industrial sentiment improved following a 90-day tariff truce agreed by the United States and China during trade talks. The average LNG price for July delivery into north-east Asia was at $11.75 per million British thermal units (mmBtu), up from $11.50/mmBtu last week, industry sources estimated. 'Activity has picked up somewhat and prices have started to trend upwards with some utilities and traders stepping in to pick up June cargos,' said Toby Copson, chairman at Davenport Energy Partners. He added that the market was not tight from a fundamental perspective but lower prices have tempted some buyers who need to satisfy their contractual volume obligations. In April, China, the world's largest LNG buyer, recorded its lowest LNG demand since October 2022, and has been reselling U.S.-sourced LNG cargoes to Europe due to a tariff war with the United States. A 90-day tariff truce was agreed by the United States and China during trade talks in Switzerland last weekend. This could unblock some of the two-way trade brought to a standstill by the conflict between the world's two biggest economies. If a final deal between the two powers is agreed, it might spur economic activity in China and support a pick up in gas demand. Global LNG: Asian spot prices hold at 1-year low as demand remains tepid 'While these tariffs are unlikely to have an effect on physical LNG flows, with China's 25% tariff on U.S. LNG still enough of an incentive for Chinese firms to send their U.S. cargoes elsewhere, the positive news supported industrial demand expectations,' said Martin Senior, head of LNG pricing at Argus. Go Katayama, LNG and gas analyst at data analytics firm Kpler said that further Asian price upside is possible driven by warmer-than-normal temperatures in Thailand. In Europe, gas prices at the Dutch TTF hub remain range-bound between 34-35 euros per megawatt hour. 'While ample supply and subdued demand have kept prices capped, a persistently narrow JKM-TTF spread is prompting renewed price competition with Asia. Upcoming colder weather across Germany and central eastern Europe may nudge TTF prices higher,' Kpler's Katayama said. 'The outlook remains range-bound due to relaxed EU storage targets and coupming maintenance at key regasification sites like Zeebrugge and Montoir,' he added. S&P Global Commodity Insights assessed its daily North West Europe LNG Marker (NWM) price benchmark for cargoes delivered in June on an ex-ship (DES) basis at $10.897/mmBtu on May 15, a $0.63/mmBtu discount to the June gas price at the TTF hub. Argus assessed the price for June delivery at $10.845/mmBtu, while Spark Commodities assessed it at $10.946/mmBtu. The U.S. arbitrage to north-east Asia via the Cape of Good Hope increased this week, marginally pointing to Europe, while the arbitrage via Panama continues to point to Asia, said Spark Commodities analyst Qasim Afghan. In the LNG freight market, Atlantic rates showed their largest week-on-week drop since January and were assessed at $32,500/day on Friday, while Pacific rates remained relatively stable at $22,250/day, Afghan added.
Business Recorder
25-04-2025
- Business
- Business Recorder
Global LNG: Asian spot prices hold at 1-year low as demand remains tepid
SINGAPORE: Prices of Asian spot liquefied natural gas (LNG) inched up this week amid production outages in Asia and Europe, but were still hovering at nearly one-year lows on overall tepid demand. The average LNG price for June delivery into north-east Asia was at $11.80 per million British thermal units (mmBtu), estimated industry sources, up from $11.50/mmBtu last week which were its lowest levels since mid-May. There are limited buyers for prompt cargoes, with Chinese and Indian importers taking a back seat as prices are above $11.00/mmBtu, said Argus head of LNG pricing Martin Senior, adding that South Korea is currently the main spot buyer in Asia. 'South Korean demand has stayed strong, with stocks held by the country's state-owned Kogas last heard to be around 20 percent full, which has prompted buying interest not only from Kogas, but also from Komipo, Kospo and Prism,' he said. 'Spot prices are below Kogas' domestic tariff, meaning it can be profitable for private importers to buy cargoes.' On supply, the situation remains healthy despite the recent outage at Petronas' Bintulu LNG complex, said Siamak Adibi, director for gas and LNG supply analytics at FGE. Global LNG: Asian spot prices hold at 1-year low amid supply disruptions Equinor's Hammerfest terminal, Europe's largest LNG export facility, also went offline on Tuesday for planned annual maintenance until July 19. Exports from Venture Global's Plaquemines plant in the U.S. have reached 1 million tons per month, while BP has loaded its first cargo from the Greater Tortue Ahmeyim project offshore Mauritania and Senegal, said Adibi. 'We also expect the startup of LNG Canada from mid-year and a ramp-up in supply from Corpus Christi,' he added, referring to Cheniere Energy's plant in the U.S. In Europe, S&P Global Commodity Insights assessed its daily North West Europe LNG Marker price benchmark for cargoes delivered in June on an ex-ship basis at $10.49/mmBtu on April 24, a $0.70/mmBtu discount to the June gas price at the Dutch TTF hub. Argus assessed the price for June delivery at $10.58/mmBtu. Spark Commodities assessed the May price at $10.376/mmBtu. While Europe's gas demand has started to fall due to a seasonal trend, concerns surrounding storage injections for summer remain, said Florence Schmit, energy strategist at Rabobank London. 'The winter premium to summer contracts is still only trading at around 0.50 euros per megawatt hour, which is not enough to incentivize full injections,' she said. 'What's more, the EU's Russian fuel phaseout roadmap promises to squash any expectation of returning Russian pipeline supplies, driving European buyers further towards seaborne imports.' In LNG freight, Atlantic rates rose to $35,750/day on Friday, while Pacific rates slipped to $22,250/day, said Spark Commodities analyst Qasim Afghan. Despite pointing to Asia earlier this week, the U.S. front month arbitrage to north-east Asia via the Cape of Good Hope has closed out, now marginally pointing to Europe, he added.
