Log in
Show password
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Dynamic quotes 
News: Latest News
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 
All NewsEconomyCurrencies & ForexEconomic EventsCryptocurrenciesCybersecurityPress Releases

Asian LNG prices set to spike more this winter on low inventories

09/28/2021 | 07:30am EDT
FILE PHOTO: An LNG tanker passes boats along the coast of Singapore

SINGAPORE/NEW DELHI (Reuters) -Asian spot liquefied natural gas (LNG) prices are set to spike further this winter and may break previous records set last winter as inventory levels remain low and producers are yet to ramp up supply, executives said on Tuesday.

Spot LNG prices hit about $29 per million British thermal units (mmBtu) on Monday, and are expected to remain well above $25 per mmBtu this winter, said Jeff Moore, manager of Platts' Asian LNG Analytics division during the Platts APPEC 2021 conference.

A cold winter earlier this year pushed spot prices to a record high of $32.50 per mmBtu in mid-January as gas inventory was drawn down to meet the demand surge.

Following that, a pick up in economic activities from the easing of coronavirus-induced restrictions in many countries sent demand spiking further, causing gas storage levels to fall to multi-year lows towards the end of summer, said Sid Bambawale, LNG trading manager at Vitol during a separate panel discussion at the conference.

"This week, we start the winter season.. It's going to come down to one thing and that's the weather," he said, adding that a cold winter will send prices surging further.

Cold temperatures typically increase demand for gas for heating and limited storage capacity means companies are not able to stockpile volumes ahead of time.

Record high Dutch TTF gas prices are also having a direct impact on Asian prices and in turn sending a ripple effect throughout the industry, said Denis Bonhomme, vice president of LNG at TotalEnergies China.

"It's a tense outlook this winter," he added.

However, high prices and volatility is ultimately not good news for both buyers and sellers, said executives from Russia's Novatek and U.S. LNG company Cheniere Energy.

Platts is expecting prices to eventually fall more than $15 to about $11 per mmBtu next summer, Moore added.

India's top gas importer Petronet LNG said that high spot LNG prices on a sustained basis would dent demand for the super cooled gas.

"Current spot prices are high. They are not sustainable. I expect them to stabilize soon. If they continue, it will lead to demand destruction," said A. K. Singh, chief executive of Petronet at a shareholders meet in New Delhi.

(Additional reporting by Koustav Samanta in Singapore, Nidhi Verma in New Delhi; Editing by Jacqueline Wong, Christian Schmollinger and Louise Heavens)

By Jessica Jaganathan

© Reuters 2021
Stocks mentioned in the article
ChangeLast1st jan.
CHENIERE ENERGY PARTNERS, L.P. -0.25% 43.93 Delayed Quote.24.62%
RIPPLE (XRP/EUR) 0.00% 0.93535 Real-time Quote.422.45%
Latest news "Economy & Forex"
05:30pUk says talks with eu on northern ireland protocol have been constructive, but substantial gaps remain
05:30pUK says substantial differences remain with EU over N.Ireland trade
05:30pUK plans 3 billion pounds of new education funding in budget
05:24pMCX MULTI COMMODITY EXCHANGE OF INDIA : reports Net Profit of 32.66 cr. in Q2 FY21-22
02:55pU.s. cdc reports total novel coronavirus cases of 45,316,210 as of yesterday versus 45,235,796 in previous report on oct 22
02:55pU.S. CDC Reports Total Deaths Of 733,834 Due To Coronavirus As Of Yesterday Versus 731,931 In Previous Report On Oct 22
02:54pU.s. cdc reports total deaths of 733,834 due to coronavirus as of yesterday versus 731,931 in previous report on oct 22
02:53pU.s. cdc says as of october 23, 12,472,219 people received a booster dose for covid-19 vaccine since august 13, 2021
02:52pU.s. cdc says 190,402,262 individuals have been fully vaccinated against covid-19 as of oct 23 vs 190,179,553 individuals as of oct 22
02:52pU.s. cdc says 220,145,796 individuals have received at least one dose of covid-19 vaccine as of oct 23 vs 219,900,525 individuals as of oct 22
Latest news "Economy & Forex"