LONDON- Asian buyers of liquefied natural gas (LNG) benefitted from a fall in prices this week as stockbuilding eased, China’s demand remained weak and players watched for action from EU energy ministers.
The average LNG price for October delivery into north-east Asia LNG-AS was estimated at $46 per million British thermal units (mmBtu), down $8.5, or 18.5 percent, from the previous week, industry sources said.
“LNG prices retreated as Northeast Asian buyers hit pause on their stockbuilding activities and as Chinese demand remained weak,” said Edmund Siau, LNG analyst at consultancy FGE.
China has asked importers to check inventories as a precautionary measure ahead of winter, and they may procure more fuel in coming months if storage is not enough, ANZ said in a report.
The lack of LNG available under long-term contracts may also push Japanese and Korean buyers back to the spot market ahead of winter, which if it turns out to be cold will fuel intense competition for LNG at a time Europe is facing the worst energy crisis in decades.
In Europe, S&P Global Commodity Insights assessed LNG prices on a delivered ex-ship (DES) basis into north-west Europe (NWE) at $47.303/mmBtu on Sept. 8, a discount of $15.75/mmBtu to October Dutch gas prices, said Ciaran Roe, global director of LNG.
