• Wednesday, February 21, 2024
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Asia LNG prices fall on lower winter demand, WGI says


Liquefied natural gas prices in Northeast Asia fell on weakening winter demand from the region, according to Energy Intelligence Group. LNG for delivery over the next four to eight weeks dropped to $18.60 per million British thermal units in the period from Dec. 17 to Dec. 30, from about $19, the New York-based research company said on the website of its World Gas Intelligence (WGI) publication.

Southwest Europe prices increased to $15.50 from $14.30. The company didn’t publish prices last week due to the Christmas holiday.

“With both Chinese and South Korean winter demand satisfied, Japanese buyers are in the Northeast Asian driving seat,” according to WGI. Japan’s power utilities are seeking three February cargoes, according to the research company.

Asian LNG importers typically purchase spot cargoes during December to March to meet peak heating and power demand during winter in the northern hemisphere. Buyers from Japan, India and South Korea are looking for as many as eight shipments for delivery between January and March, Bloomberg reported earlier.

There is a “demand surge” for natural gas in Europe due to the continent’s cold start to 2014, according to WGI. “Spanish power demand is expected to rocket this month on below-normal temperatures at a time when Spain has seen lower LNG shipments from Algeria and weak flows of piped imports from France, prompting a number of utilities to eye spot shipments” of LNG, WGI said.

Most of the market’s available spot supply has been purchased by Asian buyers, driving up prices for European companies, according to the WGI report. Shipments from Norway and Nigeria remain available to buyers in Asia and Europe, WGI said.