LONDON, Aug 22 (Reuters) - Asian spot liquefied natural

gas (LNG) prices were slightly down this week on high storage

inventories, continued weak demand and lack of progress on peace

talks for Ukraine.

The average LNG price for October delivery into north-east

Asia was at $11.40 per million British thermal units

(mmBtu), down from $11.65 /mmBtu last week, industry sources

estimated.

"We expect further downside to Asian LNG prices, as storage

levels remain elevated, while the supply picture continues to

firm," said Go Katayama, LNG and gas analyst at data analytics

firm Kpler.

Although Japan's summer heat continues, demand for November

heating is lagging. Meanwhile, China is leaning more heavily on

domestic gas and pipeline imports, reducing reliance on spot LNG

and South Korea is well-stocked, exerting further downside

pressure.

"Amid these conditions, spot prices may need to test below

the $10/mmBtu threshold to revive meaningful buying interest,"

Katayama added.

Martin Senior, head of LNG pricing at Argus said that prices

were affected by the lack of an immediate progress on peace

talks for Ukraine, which may lead to an eventual unsanctioning

of just over 15 million tons per annum (mtpa) of LNG export

capacity.

In China, some of the national oil companies (NOCs) were

re-offering cargoes and higher stocks are limiting injection

demand, while and strong hydro generation in Guangdong has

weighed on gas generation economics, Senior said.

Cooler summer in South and Southeast Asia, has weighed on

spot demand, he added.

In Europe, gas prices steadied on Friday around firmer

levels reached in the previous session, as attention turns to

upcoming heavy maintenance in Norway and gas storage filling

needs before the winter.

"The market is feeling fairly comfortable with European

storage filling steadily, Chinese demand remaining low and new

projects including U.S. Plaquemines and LNG Canada building up

output," said Alex Froley, senior LNG analyst at ICIS.

Froley added that if the early months of winter prove

comfortable, the market may start sliding further in the second

half of winter and into summer 2026.

Aly Blakeway, manager of Atlantic LNG at S&P Global

Commodity Insights, said that Europe continues to lure in the

brunt of US supply despite the relatively lacklustre demand.

LNG imports into the continent remain healthy with

expectations for an uptick in procurement of the super-chilled

fuel ahead of the heating season, he added.

S&P Global Commodity Insights assessed its daily North West

Europe LNG Marker (NWM) price benchmark for cargoes delivered in

October on an ex-ship (DES) basis at $10.857/mmBtu on August 21,

a $0.525/mmBtu discount to the September futures price at the

TTF hub.

Argus assessed the price at $10.87/mmBtu, while Spark

Commodities assessed it at $10.809/mmBtu.

The U.S. arbitrage to north-east Asia via the Cape of Good

Hope is still incentivising U.S. cargos to deliver to Europe.

The arbitrage via Panama is marginally pointing to Europe, said

Spark Commodities analyst Max Glen-Doepel.

Global LNG freight rates have marginally increased this

week, with the Atlantic rates assessed at $36,500/day and

Pacific rates at $35,000/day, he added.