Global LNG Prices Pick Up

Asian liquefied natural gas (LNGLF) (LNG) spot prices for August delivery rose on Friday as supplies tightened and traders manoeuvred cargoes between Atlantic and Pacific basins to cover short positions.

 

End-user demand, however, remained muted.

 

The price of Asian spot cargoes rose to $7.70 per million British thermal units (mmBtu), from $7.55 the previous week. Bids for August were in the high $7/mmBtu range while offer prices were at $8/mmBtu or above, three traders said.

 

Prices for September were broadly unchanged from August, although the structure of the September market - i.e. in which parts of the month demand was concentrated - remained unclear.

 

"The Nigeria tender is attracting a lot of interest and seems quite key, it's at the threshold of Atlantic and Asian markets, those price levels will be an interesting marker," one trader said.

 

Another said he expected Nigeria LNG to award the free-on-board cargo, loading on July 17-19, for a price above $7/mmBtu.

 

"It's tightening up the Atlantic market, there's now demand from Argentina, Jordan, Egypt and Pakistan for supply," the first trader said.

 

Atlantic LNG markets showed demand in the first-half of August exceeding demand in the second-half, which was reflected in pricing.

 

Atlantic LNG prices were jolted higher following Argentina's surprise tender this week seeking 8 cargoes for delivery in August through September, traders said.

 

Brazil's Petrobras can hit multiple delivery windows proposed by Argentina's state-run YPF and is crafting a bid, one source said.

 

Two cargoes are to be exported from the Gate terminal in the Netherlands at the end of the month, one of which was picked up by German utility RWE.

 

Trafigura is to deliver one or two cargoes to Pakistan this month after winning a tender this week, priced likely around $8/mmBtu due to the very prompt delivery window.

 

In Asia-Pacific, excess production availability from Australia's Pluto export plant could be a source of further supply, one South Korea-based source said.

 

Indonesia's Bontang export plant is offering a cargo loading August 16-17, with bids due on Monday.

 

India's Gail is seeking two prompt cargoes for delivery between July 14 and August 3, linked to fertiliser production demand. State-run Indian Oil Corp is yet to award its tender to buy a cargo for Aug. 6-7.

 

ExxonMobil's Papua New Guinea export project is selling one cargo for delivery on Sept. 4-5.

 

Global supplies remained ample, with limited disruption beyond ongoing issues in Yemen.