Asia's imports of liquefied natural gas are set for the weakest September in eight years as high spot prices deter buyers in China and South Asia.
The top-importing continent is expected to see arrivals of 20.09 million tonnes of the super-chilled fuel in September, the lowest for this month since the 19.88 million in September 2018, according to data compiled by commodity analysts Kpler.
Asia's imports are down from the 22.27 million tonnes in September last year, and also a drop from the 22.25 million in August.
If there is a silver lining for the global LNG market, it's that the slump in Asian demand is freeing up cargoes for Europe, which is battling to ensure sufficient natural gas storage ahead of the northern winter.
Natural gas inventories in the European Union are around 68 per cent full, which is about 16 percentage points below the five-year average.
Europe is starting to draw more LNG cargoes, with Kpler estimating September imports will rise to 7.98 million tonnes, the most since May and up from 7.55 million in August.
The upward trend is forecast to continue, with Kpler estimating October arrivals at 10.53 million tonnes and November at 10.62 million, which are levels largely in line with the same months in 2025.
The data show Asia is once again forgoing cargoes, which allows Europe to buy more LNG, albeit at a significant price premium.
The ongoing loss of Qatar's LNG because of the war between the United States and Iran and the resulting conflict over shipping in the Strait of Hormuz has tightened the market.
Prior to the start of the war on February 28, Qatar supplied nearly 20 per cent of global LNG and vied with Australia as the second-biggest shipper behind the United States.
But Qatar's shipments have cratered, with Kpler showing that just 70,000 tonnes, or one cargo, managed to exit the Strait of Hormuz in August, down from an average of 6.51 million tonnes in the three months to the end of February.
The absence of Qatar's LNG has driven spot prices to 45-month highs, with cargoes for delivery to North Asia being assessed at $26.00 per million British thermal units (mmBtu) in the week ended September 11.
This is up 150 per cent from the $10.40 per mmBtu that prevailed in the week to February 27, meaning that spot LNG has risen three times as much as the 50 per cent rise in Brent crude futures over the same time period.
China, which is on track to lose its title of world's largest LNG buyer to Japan this year, is continuing to cut back on LNG imports, with Kpler estimating September arrivals at 4.32 million tonnes, down from 5.20 million in August and 5.32 million in September last year.
While China continues to take long-term cargoes on fixed or oil-linked prices, the current spot price is about double the level that allows imports to remain profitable.
India, Asia's fourth-largest LNG buyer, is also showing signs of price stress, with September imports forecast to drop to 1.86 million tonnes, the lowest since March and down from 2.09 million in September last year.
Neighbouring Pakistan is slated to receive only 120,000 tonnes in September, down from 490,000 tonnes in the same month last year.
The overall dynamic in the global LNG market is largely a repeat of the last crisis in 2022, sparked by the loss of Russian pipeline gas into Europe after Moscow invaded Ukraine in February of that year.
Spot prices in Asia hit a record high of $70.50 per mmBtu in August 2022, and while that was a brief spike, they remained above $20 until the middle of January 2023.
Asia's imports of LNG dropped in both 2022 and 2023 from 2021 levels and didn't recover until 2024, when they hit a record high of 287.16 million tonnes.
In contrast, Europe's LNG imports surged in 2022, reaching a then-record of 124.54 million tonnes, up 59 per cent from 2021.
The ongoing absence of Russian pipeline gas has kept Europe's LNG imports elevated, with a fresh peak of 125.20 million tonnes set in 2025.
But 2026 is set to be a new record year, with imports of 117.01 million tonnes already assessed by Kpler, a figure that will rise in the last quarter.
(By Clyde Russell, Editing by Jamie Freed)