Asia spot LNG prices slip on weak northeast Asia demand, US-Iran diplomacy hopes
UNG•The November-delivery Asian spot LNG price was estimated at $25.85 per mmBtu, down from $27.00 the previous week, as subdued northeast Asian demand and hopes for US-Iran diplomacy weighed on prices.
1. Asian prices ease
The average price for November delivery into northeast Asia was estimated at $25.85 per million British thermal units, down from $27.00 per mmBtu the previous week. The price had reached a near four-year high earlier this week.
2. Demand and supply outlook
Analyst Evan Tan said northeast Asia was largely covered heading into winter, with healthy Japanese inventories and likely limited South Korean restocking given expectations of mild weather. China stayed out of the spot market as cheaper domestic gas made LNG uneconomic, while South Asia accounted for most prompt buying. Expectations of higher Qatari exports also weighed on prices, although Middle East supply volumes remain far below pre-March levels.
3. European market and freight
European October LNG benchmarks ranged from $24.616 to $24.81 per mmBtu. European storage inventories rose above 70% during the week. Atlantic LNG freight rates rose for a fourth straight week to $29,500 a day, while Pacific rates gained for a third straight week to $31,000 a day.
