Asian spot LNG prices recover a little on improving demand
Asian spot liquefied natural gas (LNG) prices recovered a little this week as demand appeared to improve amid the easing of coronavirus lockdowns in a few countries, trade sources said.
That followed three straight weeks of decline.
While lockdowns are easing in some markets, such as in China and South Korea, containment policies elsewhere are hampering their manufacturing exports and dragging on recoveries.
South Korea’s GS Energy entered the spot market, seeking two cargoes for delivery in June, while Chinese utility Guangdong Energy group, previously known as Guangdong Yudean Group, was seeking a cargo for July, sources said.
Chinese buyers were also participating in sell tenders by other companies, one of the sources said.
Thailand’s PTT issued an expression of interest to seek a cargo for delivery in late June, industry sources said.
India’s Bharat Petroleum Corp Ltd likely bought a cargo for delivery on May 25 at about $2.10 to $2.20 per mmBtu, an industry source said, though this could not immediately be confirmed.
India’s LNG demand may be improving slightly on the back of higher demand for summer residential use, though overall power demand is down by a third due to lower industrial activity, a source based in India said.
Still, supply is ample globally, which is expected to keep spot prices depressed, trade sources said.
Angola LNG offered a cargo for delivery to as far as Singapore over May to June in a tender that closes on May 13, an industry source said.
The number of vessels being used to temporarily store LNG is also swelling, trade sources said.
There are currently eight Nigerian-laden LNG cargoes which have been floating for between three and 25 days, said Kaleem Asghar, director of LNG Analytics at ClipperData.
Seven of them are in the Atlantic, floating offshore Spain, while one is off the west coast of India, he added.
U.S. natural gas prices also topped benchmarks in both Europe and Asia for the first time ever this week, giving buyers of U.S. LNG another reason to cancel cargoes.
LNG buyers in Asia and Europe have already cancelled the loading of around 20 cargoes from the United States in June, while many are expecting cancellations to continue for cargoes loading in July.
Reporting by Jessica Jaganathan; Editing by Mark Potter
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