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GLOBAL LNG-Asian spot LNG remains near highest level this year
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GLOBAL LNG-Asian spot LNG remains near highest level this year
Dec 6, 2024 6:47 AM

LONDON, Dec 6 (Reuters) - Asian spot liquefied natural

gas (LNG) prices edged down this week as high inventories

depressed demand, but prices remained near their highest level

this year, tracking European gas prices which have risen on

supply concerns.

The average LNG price for January delivery into north-east

Asia was at $15.00 per million British thermal units

(mmBtu), slightly lower than $15.10/mmBtu last week, industry

sources estimated.

"Colder temperatures in north-east Asia will keep prices in

check although not expected to lift spot demand as ample

inventory levels and high LNG prices will sideline major

buyers," said Go Katayama, LNG and natural gas analyst at Kpler.

"We think Asian prices will hold steady, with some risks on

downside due to recovering supply from the Pluto and Freeport

(facilities), higher pipeline gas from Russia to China and

higher nuclear availability in Japan," Katayama said.

Pakistan's deferment of some Qatari LNG cargoes from 2025 to

2026 marks the second occasion in a month in which a country

bought more LNG beforehand but in the end will consume less,

after Egypt's slowdown of cargoes due to logistic complexities,

said Klaas Dozeman, market analyst at Brainchild Commodity

Intelligence.

"This creates a slight loosening of the balance for 2025,"

Dozeman added.

In Europe, gas prices were firm amid colder weather this

week and faster gas storage withdrawal.

"Europe's gas storage facilities are below the levels of the

previous two years, although they are still significantly higher

than they were at the same time in 2021 ahead of the energy

crisis of 2022," said Alex Froley, senior LNG analyst at data

intelligence firm ICIS.

"If the rest of winter is mild, prices could fall back, but

if it remains colder, storage will enter next summer lower than

last year, which has contributed to stronger prices for summer

2025," Froley said.

S&P Global Commodity Insights assessed its daily North West

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

January on an ex-ship (DES) basis at $14.209/mmBtu on Nov. 14, a

$0.20/mmBtu discount to the January gas price at the Dutch TTF

hub.

Argus assessed the price at $14.220/mmBtu, while Spark

Commodities assessed it at $14.20/mmBtu.

European interest in cargoes for next year was shown this

week by two tenders by Poland's Orlen and Turkey's Botas, said

Samuel Good, head of LNG pricing at Argus.

Competition between the Pacific and Atlantic basis have

remained strong, with the arbitrage - moving cargoes from one

place to another - for U.S. loadings holding open for prompt

cargoes but shut for most exports planned for Q1, Good said.

The U.S. arbitrage to north-east Asia via the Panama Canal

is currently also signalling U.S. cargos to north-west Europe,

said Spark Commodities analyst Qasim Afghan.

In LNG freight, Atlantic rates have rose for the second week

running to $22,000/day on Friday, while Pacific rates steadied

at $23,750/day, the analyst added.

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