Asian LNG Dips From Three-Year High as Traders Weigh Hormuz Plan
(Bloomberg) — Asian liquefied natural gas prices pulled back slightly from the highest level in three years, as the market weighed the viability of an American plan to ensure safe passage for tankers through the Strait of Hormuz.
Spot LNG eased to around $23.80 per million British thermal units in Asia, said traders, but levels were still more than double compared with last week. The sharpest rally in European natural gas in four years came to an abrupt halt on Wednesday after President Donald Trump flagged the safe transit plan.
Natural gas prices jumped this week following a halt at Qatar’s Ras Laffan plant — the world’s biggest LNG export facility — and the effective closure of Hormuz, which is threatening the worst supply shock since Russia invaded Ukraine in 2022. Buyers in Asia are scrambling for alternative supply, with the disruption already impacting some industries and signaling higher electricity prices.
Some LNG tankers have redirected toward Asia after initially heading for Europe, as competition intensifies. Still, prices are too high for some buyers, especially India, traders said. Instead, those importers are opting for short-term supply cuts to industries, rather than taking expensive cargoes, they added.
Qatar’s halt especially affects Asia, with most of its production shipped to the region, and a prolonged halt is likely to increase competition with Europe for cargoes from other destinations, keeping prices high.
More News:
PTT seeks to purchase at least one LNG cargo on a DES basis for late-March to early-April delivery to Thailand India’s Gujarat State Petroleum Corp. bought a cargo on a DES basis for April delivery Construction at Abu Dhabi National Oil Co.’s Ruwais LNG export facility is on track, CEO Sultan Al Jaber told reporters in Tokyo on Thursday GAIL India’s long-term supplier of LNG, Petronet LNG, has stopped deliveries under long-term contracts after issuing a force majeure notice citing shipping constraints Taiwan has secured LNG supplies for April from regions outside the Middle East A Russian LNG tanker sanctioned by the US halted its journey in the Mediterranean Sea after a nearby ship was allegedly attacked by Ukrainian drone boats At least three LNG tankers diverted toward Asia from their course toward Europe as Middle East turmoil spurs competition for the fuel, while freight rates set fresh records and add to market volatility Drivers:
European natural gas prices resumed their sharpest rally in years as uncertainty around the war in the Middle East continues to rattle energy markets China’s 30-day moving average for LNG imports on Mar. 4 was 99k tons, 32% lower than a year ago, according to ship-tracking data European gas storage levels were ~30% full on Mar. 3, compared with the five-year seasonal average of ~45% Europe’s 30-day moving average for LNG imports was 279k tons/day on March 4, 49% higher than the five-year seasonal average, according to ship-tracking data Estimated flows to all US export terminals were ~19.1 bcf/day on Mar. 4, down 2.5% w/w: BNEF Buy tender:
Sell tender:
–With assistance from Stephen Stapczynski.
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