Traders are cashing in on higher gas prices in Europe against Asia, diverting at least two liquefied natural gas tankers that were initially eastbound towards Europe and Turkey in the past week, shiptracking data showed.
Falling temperatures in the northern hemisphere are boosting heating demand, lifting prices in both Asia and Europe and increasing regional competition for LNG supply.
Asian LNG futures based on the benchmark SP Global Energy Platts Japan-Korea Marker (JKM) price was at $11.22 per million British thermal units (mmBtu) on Thursday.
Meanwhile, the benchmark front-month contract at the Dutch Title Transfer Facility hub closed at €38.22 per megawatt hour on Thursday, or $13.17 per mmBtu, boosted in recent days by cold weather and low storage levels.
"Europe's pull of LNG cargoes remains strong, given a recent cold snap, accelerating gas storage withdrawals," said Ashley Sherman, senior analyst at Vortexa.
However, he added that Northeast Asia's colder weather below seasonal norms is expected over the rest of January, which should keep regional demand and competition for flexible cargoes firm.
One recent tanker diversion was Clean Resolution, which is carrying a cargo from the Corpus Christi facility on the US Gulf Coast. It was moving south before turning northward towards Europe on January 21, data from analytics firms Kpler and LSEG show. Kpler lists Mugardos, Spain, as its destination.
Tanker Zoe Knutsen, which picked up a cargo from Oman's Qalhat terminal on January 9, was also eastbound and had sailed past India and Sri Lanka before pivoting to move southwest on January 15, showed LSEG and Kpler data.
The tanker is currently crossing the Indian Ocean, moving past Madagascar, and is scheduled to arrive at Marmara Ereglisi, Turkey on February 12, according to LSEG data.
Oman's Qalhat LNG plant typically ships LNG to Asia, with its cargoes going to markets like Japan, China, India, South Korea and Taiwan.
Asyraf Amin, Kpler's principal market analyst for LNG gas data, said the tanker was first signalling Batangas in the Philippines, before switching to Milford Haven in the United Kingdom and now to Ereglisi in Turkey.
A widening premium of the Dutch TTF gas hub price over the Japan-Korea-Marker recently could have led to the diversion, he added.
The TTF is widely used as a price benchmark for LNG deliveries into Europe, while the JKM is the LNG benchmark price assessment for spot physical cargoes in Asia.
(Reporting by Emily Chow; Editing by Florence Tan and Harikrishnan Nair)