LONDON- Asian spot liquefied natural gas (LNG) prices were steady this week, holding near a six-month peak on higher gas-for-power demand due to heat wave in India and East Asia and expected above-normal temperatures for China in mid-June.
The average LNG price for July delivery into north-east Asia LNG-AS was at $12.00 per million British thermal units (mmBtu), unchanged from the previous week and close to its highest levels since mid-December, industry sources estimated.
“We now see some sort of LNG pull from Europe as Asian demand remains robust.
Fortunately, storage levels in Europe are still high, so there is no immediate need for large imports,” said Siamak Adibi, principal consultant at energy consultancy FGE.
Asian markets were also supported initially by European gas supply concerns, but have largely retained their gains as additional interest has emerged from buyers, especially in Japan and South Korea, said Samuel Good, head of LNG pricing at commodity pricing agency Argus.
The Japan Meteorological Agency foresees a 50.6 percent probability for an above-normal temperature occurrence between June and August, with the potential to drive up gas-for-power demand, while South Korea has a 50 percent probability for above-average temperatures between June 3 and June 23, Rystad Energy data showed.
More Atlantic LNG was shipped to Asia, and the open inter-basin arbitrage suggests a firm incentive for this to continue, Good said.
In Europe, gas prices rose by 11.4 percent on Monday, hitting a six-month high, on concerns over Norwegian supply due to unplanned outage at Gassco-operated Nyhamna processing plant.
