LONDON- Asian spot liquefied natural gas (LNG) prices were down this week on renewed lockdown in Shanghai, indicating lesser demand from China, while summer procurement in other Asian countries picked up.
The news of an at least three-week shutdown at Freeport LNG, operator of one of the largest US export plants producing liquefied natural gas, didn’t affect Asian prices much, as most of the cargoes were headed to Europe.
The average LNG price for July delivery into north-east Asia LNG-AS was estimated at $23.5 per metric million British thermal units (mmBtu), down $1.25 or 5.1 percent from the previous week, industry sources said.
“While spot prices have declined in recent weeks relative to the earlier days of the Russia-Ukraine war, they are still at extremely high levels compared to historical patterns,” said Edmund Siau, LNG analyst at consultancy FGE.
Siau added that difficulties in ramping up alternative sources of power generation push utilities to procure spot LNG even though prices remain high.
Japan-Korea-Marker (JKM) prices – which are widely used as a benchmark for Asian LNG – was assessed by S&P Global Insights at $23.486 per mmBtu on Thursday, following the Freeport outage news, an increase of $1.694, or 7.8 percent, from the previous day.
In Europe, S&P Global Commodity Insights assessed LNG prices for a delivered ex-ship (DES) basis into Northwest Europe at $23.439 per mmBtu on June 9, at a discount of $3/mmBtu to the July price on the Dutch gas TTF hub. — Reuters
