Global LNG eases from record summer highs as buyers baulk at soaring prices
Quantum Commodity Intelligence – Global LNG prices have eased back from recent peaks this week but remain at unseasonally high levels, according to exchange data and market watchers Wednesday.
JKM August futures fell by 1.75% to $12.885/mmBtu on Tuesday, while the September contract dropped 6% to around $13.025/mmBtu.
Meanwhile, Dutch TTF gas prices hit fresh multi-year highs of €37.35/MWh on Tuesday, before easing back on Wednesday.
"North Asian LNG futures fell as end users baulked at rising spot prices. Importers are becoming increasingly reluctant to chase the market higher, with recent restocking efforts allowing them some time to assess the market," said Daniel Hynes, senior commodity strategist at ANZ.
"Dutch gas futures continue to surge higher, following news that Gazprom decided against booking further pipeline capacity to ship fuel to Europe. This will exacerbate tightness in that market amid low inventories," he added.
In the US, benchmark NYMEX Henry Hub natural gas futures eased back from a 30-month high $3.822/mmBtu on Tuesday, but prices remain unseasonally high following the US heatwave.
Elsewhere, ENN LNG (Singapore) Pte Ltd, a unit of private Chinese gas distributor ENN Group, was reported to have agreed to buy 26 cargoes LNG for 2022 and 2023, Reuters reported.
The cargoes will be priced against the Dutch TTF benchmark, rather than rival JKM, said the report.
The cargoes were bought at premiums of $1-2/mmBTU over TTF.
The two-year agreement was in addition to a 10-year tender ENN issued in March, as ENN's east China-based receiving terminal has since last August expanded in handling capacity thanks to a newly started pipeline to a provincial grid.
