LONDON- Asian spot liquefied natural gas (LNG) prices inched up on Friday after remaining flat this week, amid concerns over some cargo delays due to bad weather in Australia and as Asian buyers embraced the low prices.
The average LNG price for April delivery into north-east Asia which expires on Friday, remained unchanged from last week at $8.60 per million British thermal units (mmBtu), a level last seen in late April 2021, industry sources estimated.
However, the price for May delivery jumped to $9/mmBtu, the sources added.
“Market players continue to eye firm Asian demand for Atlantic supply, with the inter-basin arbitrage (cargo diversion from one market to another) for US loadings holding open in recent days,” said Samuel Good, head of LNG pricing at commodity pricing agency Argus.
“With European receipts already slowing so far this month, the incentive for inter-basin flows could weigh on European LNG supply further in the coming weeks,” he said, adding that Asia LNG futures also rose sharply, keeping pace with Europe.
Good and other trading sources said prices received some support after an earthquake with a preliminary magnitude of 5.8 hit eastern Japan early on Friday, but the absence of a tsunami warning quelled concerns.
The market is also watching closely how a tropical cyclone hitting Australia will affect northwest Australian LNG terminals.
Trading sources said the bad weather was affecting traffic at Gorgon LNG facility and expected some cargo delays but said it wouldn’t have a major impact.
In Europe, gas prices are testing an upside trend, although inventories are well filled for the time of the year, and the end of the winter season is around the corner, said Hans Van Cleef, chief energy economist at PZ – Energy Research & Strategy.