Reuters are reporting that Asian spot LNG prices rose this week to their highest since February as buying interest from China remained firm and as supply is expected to be limited during maintenance in August.
Spot prices for July delivery in Asia were at US$9.60 per million British thermal units (Btu) last week, gaining 40 cents from the previous week and are at the highest for this time of the year since 2014.
Higher oil prices had been deterring some buyers from snapping up cargoes in the spot market in recent weeks but some of them may now need to cover their requirements promptly.
While some companies are offering cargoes through private negotiations, supply of the super-chilled fuel is expected to be limited in August amid maintenance at Sakhalin Energy’s offshore gas platforms in Russia and at the Angola LNG project.
Indian buyers may be reluctant to buy spot cargoes at higher prices and could turn to using coal instead.
Demand from China remained firm with some willing to pay US$9.70 to US$9.80 per million Btu.
South Koreans are also expected to step up their purchases to meet summer demand.
Still, some spot supply from Russia could keep prices in check.
Russia’s Novatek has offered a cargo in the spot market at prices above the Platts Japan Korea Marker (JKM) price.
Argentina’s Enarsa is seeking eight cargoes for August and September and September in a tender that closes on 12 June, while Angola LNG has offered a cargo for loading in mid-June.
Japan’s Inpex Corp said last week that it expects to start gas production from the wellhead for the Ichthys LNG project in Australia within a week or two following the final safety checks.
The company said first shipments of liquefied petroleum gas (LPG), condensate, an ultra-light form of crude oil, and LNG would begin by the end of September.
Read the article online at: https://www.lngindustry.com/liquefaction/04062018/lng-prices-climb-to-highest-since-february-on-limited-supply/