Prices of spot LNG for December delivery to Asia averaged US$7.280 per million British thermal units, according to the latest Platts Japan/Korea Marker data for month-ahead delivery.
The marker, which gained 8.7 percent month over month, started the assessment period at $6.80/MMBtu. It steadily gained ground during the course of the month to close at $7.65/MMBtu on November 13, as new sources of demand emerged ahead of the winter heating season.
“Buyers in China, South Korea, Taiwan and Japan continued to show limited interest for incremental cargoes,” said Platts’ Max Gostelow.
He added that most buyers were heard to be grappling with high inventories following lower-than-predicted power demand. But demand from traders with short positions and strong demand from buyers in India, Pakistan and the Middle East, combined with a lack of available cargoes, resulted in upward price pressure on the spot market.
Little price help came from China and North Asia. Only a few buyers in North Asia entered the spot market to buy several cargoes. China’s CNOOC launched its second sell tender from its equity position at Australia’s QCLNG.
Most of the end user demand for December was from South Asia and the Middle East, where LNG prices were trading at a discount to the Asia-Pacific basin. End users in India, Pakistan and Kuwait collectively tendered and/or launched expressions of interest for an estimated 14 cargoes for December-January delivery.
Meanwhile, the price of possible competing fuels, thermal coal and fuel oil were down. Thermal coal was lower by 3.2 percent on a month-on-month basis, while fuel oil was down by 0.8 percent month over month.