Asian spot liquefied natural gas (LNG) prices were flat for a second consecutive week, as steady supplies of contracted cargoes and overall weak demand across the region outweighed modest spot market interest.
The average LNG price for December delivery into northeast Asia held at $11.10 per million British thermal units (mmBtu), industry sources estimated.
The price for January delivery was estimated at $11.05/mmBtu.
"Short-lived cold spells in Asia might have resulted in a bit of spot interest without changing the overall weak picture on the market. Economically the circumstances haven't improved over the last weeks," said Klaas Dozeman, analyst at Brainchild Commodity Intelligence.
Current price levels are still too expensive for most price sensitive buyers, but minor supportive news came from Indonesia and Egypt that signalled higher domestic demand, adding a bit of tightness to the current circumstances, he said.
Spot buying interest in the region came from Taiwan’s CPC and Bangladesh’s RPGCL, said Rystad Energy senior analyst Masanori Odaka, adding that colder days are expected in the second and third weeks of November in top importers China and Japan.
While China’s downstream gas consumption should pick up this month in the winter heating season, buying interest remains muted at current spot prices and amid continuous flows of contracted LNG, said Odaka.
In Europe, SP Global Commodity Insights assessed its daily Northwest Europe LNG Marker price benchmark for cargoes delivered in December on an ex-ship basis at $9.85/mmBtu on November 13, a $0.53/mmBtu discount to the December price at the Dutch TTF hub, with prices under bearish pressure as oversupply, weak Asian demand, high freight rates and strong US liquefaction kept cargoes in the Atlantic basin.
Argus assessed the price at $9.885/mmBtu, while Spark Commodities assessed it at $9.865/mmBtu.
"Asian prices have widened their premium to European prices this week, but not because of an uptick in demand in Asia, rather much stronger freight rates in the Atlantic which has pushed Asian prices higher in order to continue to attract at least some Atlantic basin LNG," said Martin Senior, Argus head of LNG pricing.
Hedge funds extended their overall exposure to TTF futures in the week ending November 7, buying both long and short positions in almost equal measures, said independent gas analyst Seb Kennedy.
Despite briefly opening up to Asia on Wednesday, the US front-month arbitrage to Northeast Asia via the Cape of Good Hope has closed and is marginally pointing to Europe, but the arbitrage via Panama remains open, said Spark Commodities analyst Qasim Afghan.
In LNG freight, Atlantic rates rose to a new year-to-date high of $82,750/day, while Pacific rates gained to $62,000/day, its highest since October 2024, he added.
(Reporting by Emily Chow; Editing by Leroy Leo)