LONDON- Asian spot liquefied natural gas (LNG) prices fell as muted demand in Northeast Asia and high gas inventories in Europe continued to weigh on prices.
The average LNG price for August delivery into north-east Asia fell by 12.5 percent from the previous week to $10.80 per million British thermal units (mmBtu), industry sources estimated.
The average price for September delivery was forecast at $10.70/mmBtu, the sources added.
“North Asian pricing came off rapidly this week, from mid-$12 down to $10, driven by almost no near-term demand for August and September respectively,” said Toby Copson, global head of trading at Trident LNG.
“Looking at some offers, we might have found a floor and see more activity with Sept. bookings showing upside risk,” he added.
Leo Kabouche, LNG market analyst at consultancy Energy Aspects, said that restocking demand has yet to emerge, with spot tenders still largely limited to south-east Asian buyers.
“There might be a brief period of tightness in the Asia-Pacific in September due to planned maintenance at Australian LNG plants, but Asian buyers are unlikely to pull much LNG from the Atlantic basin this winter, suggesting a bearish outlook for prices as Europe will struggle to absorb as much flexible cargoes as last year given high inventories,” he said.
Samuel Good, deputy head of LNG pricing at commodity pricing agency Argus, said the call on the region’s gas-fired units from cooling power demand has been lower than expected due to higher renewables output and other forms of power generation, but many utilities are waiting to see if they will eventually need additional LNG.
