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Business Recorder
2 days ago
- Business
- Business Recorder
Global LNG: Asian spot LNG prices at 4-month high on supply concerns
LONDON: Asian spot liquefied natural gas (LNG) prices rose to their highest level in four months this week on concerns over disruptions to supply due to the Israel-Iran conflict. The average LNG price for August delivery into north-east Asia was at $14.00 per million British thermal units (mmBtu), up 11% from $12.60/mmBtu last week and the highest level since February 21, industry sources estimated. Israel began attacking Iran last Friday, saying Tehran was on the verge of developing nuclear weapons. Iran, which says its nuclear programme is only for peaceful purposes, retaliated with missile and drone strikes on Israel. 'Prices have risen sharply over the last few days. We're pricing in potential supply disruptions in the Middle East andwar premiums are going up as the conflict carries on,' said Toby Copson, chairman at Davenport Energy Partners. 'While demand really isn't there in Asia, it's likely some will bid on cargoes to cover any eventual tightening of supply,' he added. Chinese demand was around 12% lower in June compared to the same month last year, according to Alex Froley, senior LNG analyst at data intelligence firm ICIS. Global LNG: Asian spot LNG prices rise to two-week high amid renewed demand 'Geopolitics will continue to drive volatility but if physical supplies continue to be steady the market could eventually ease,' Froley said. There has not been any significant disruption to physical LNG cargoes so far. QatarEnergy has instructed tankers to remain outside the Strait of Hormuz until only the day before loading. Martin Senior, head of LNG pricing at Argus, said that some buyers could bid higher relative to European buyers to attract Atlantic basin cargoes due to disruption at Hormuz. But a full Strait of Hormuz closure still seems unlikely in the long term, said Rabobank energy strategist Florence Schmit. 'The fundamental risk for markets lies in energy infrastructure from Qatar being caught in the crossfire of any escalation. Damages to its gas production sites or even LNG export infrastructure, as well as shipping operations, will have the most bullish and long-term impact on gas prices,' she added. In Europe, gas prices at the Dutch TTF hub eased on Friday after hitting a fresh 11-week high on Thursday but remain volatile. 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 $13.739/mmBtu on June 19, a $0.385/mmBtu discount to the July futures price at the TTF hub. This 15.5% weekly increase is the highest in almost four months. Argus assessed the price for July delivery at $13.825/mmBtu, while Spark Commodities assessed the June price at $13.587/mmBtu. The U.S. arbitrage to north-east Asia via the Cape of Good Hope is now more strongly 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 recorded its largest week-on-week increase since October 2023 at $49,750/day on Friday, while Pacific rates remained steady at $32,000/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
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.
Bloomberg
22-04-2025
- Business
- Bloomberg
US LNG Headed to Asia Fetches More Than Cargoes to Europe for First Time in 7 Months
Liquefied natural gas traders can make a better profit from selling US LNG cargoes in Asia than offering the fuel in Europe, an opportunity that opened up for the first time in seven months, according to data from analytics firm Spark Commodities. The US-to-Asia arbitrage window emerged following a series of production outages in Asia that have shrunk short-term supplies in the Pacific Basin, including in Malaysia, Brunei and Australia. Meanwhile, European gas prices have eased on storage refills and subdued demand.
