Platts: spot LNG prices to Asia lowest since 2009

Prices of spot market LNG for May delivery to Asia averaged US$4.24 per MMBtu, according to latest Platts Japan/Korea Marker data for month-ahead delivery.

At $4.241/MMBtu, the April JKM was 42.5 percent below prices for the same delivery month in 2015, Platts’ report reveals.

The marker for April delivery was also at the lowest monthly average level seen since July 2009, when the monthly average for August delivered cargoes was $4.23/MMBtu, Platts historical records show.

Over the course of the assessment period, buyers in North Asia continued to have limited demand for incremental supplies, instead relying mostly on contracted volume to meet their downstream demand. Most of the activity came from buyers in India and the Middle East, who had the appetite for LNG spot cargoes at these lower prices and who expected to have demand for incremental spot market supply demand over the next few months.

“There has been smooth-flowing production from Sabine Pass in the U.S., which has so far shipped 6 cargoes since starting in May, and Angola is due to restart and load its first cargo by the end of April,” said Platts’ Max Gostelow said.

“Sentiment for May and June remained bearish due to expectations of production flows from these projects as well as multiple unsold cargoes in the Asia-Pacific region, which combined will more than compensate for volumes lost when Australia’s Gorgon LNG plant shut unexpectedly in early April following problems with its propane refrigerant circuitry.”

The price of fuel oil, a possible competing fuel to LNG, decreased 43.8 percent year over year for the latest delivery month, while thermal coal was down 17.1 percent from the same month in 2015.

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