kuala lumpur: LNG spot prices in Asia were little changed this week, as abundant inventories and mild weather limited demand from buyers in East Asia.
Industry sources estimate that the average price of LNG to be delivered in March to Northeast Asia rose slightly to $14.00 per million British thermal units.
“Demand in Asia remains tepid, with demand in East Asia relatively restrained amid warmer-than-normal weather,” said Pang Luming, senior analyst at Rystad Energy, adding that local forecasts indicate that South Korea and Japan will see higher-than-normal temperatures. Until the end of the year. Early and mid-February.
Pang said that while southern China will also see warmer than normal temperatures in the coming days, parts of the north will see cooler temperatures.
“Japanese player activity remains weak, which means there are sufficient winter stocks for the current forecast,” Pang added, adding that players in South Korea and China also continued to report sufficient winter stocks.
In Europe, S&P Global Commodity Insights assessed the Northwestern European LNG daily price index (NWM) for March-delivered cargoes on a delivered-by-ship (DES) basis at $14,589 per mmBtu on January 23, at a discount $0.37 per million British thermal units over the daily standard price. Gas price for March in the Dutch TTF Centre.
Argus estimated the price at $14.61 per mmBtu, while Spark Commodities put the February price at $14.594 per mmBtu.
Natasha Fielding, head of European gas, LNG and biomass pricing at Argus, noted that delivered LNG prices in Europe increased their premiums to Northeast Asian markets, citing disruption to shipments in the US due to storms and increased restocking orders in the summer following A German proposal to support summer injections.
Freeport LNG also closed its Texas export plant on Tuesday due to a power feed issue during a winter storm.
Fielding added that the European premium has further incentivized companies to ship uncommitted LNG cargoes in the Atlantic Basin to Europe rather than Asia, and may begin to pull Middle East supplies away from Asia as well.
LNG shipping rates have fallen to record lows, with Atlantic rates falling for the third straight week to $9,000 a day on Friday, driven by an influx of newly built ships and the routing of U.S. spot cargoes to Europe, said Qasim Afghan, a Spark Commodities analyst.
Afghan added that the US arbitrage to Northeast Asia via the Cape of Good Hope for February widened, again indicating that US cargoes have an incentive to deliver to Europe. He also noted that the first-month arbitrage from Qatar to Northeast Asia had closed for the first time in almost two years, which also stimulated deliveries to Europe via Asia.