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Asia LNG Prices Fall on Weaker Spot Winter Demand, WGI Says

Liquefied natural gas prices in Northeast Asia dropped as buyers in the region reduced demand for February cargoes to focus on March shipments, according to Energy Intelligence Group.

LNG for delivery over the next four to eight weeks fell to $18.70 per million British thermal units in the week ended Jan. 20, from $19.30, the New York-based research company said on the website of its World Gas Intelligence publication. Southwest Europe prices slid to $15.75, from $15.85.

Tokyo Electric Power Co. (9501), Japan’s largest power utility, and Kyushu Electric Power Co. (9508) are seeking “a few” shipments, according to the research company. Buyers from Japan, India and Thailand are looking to buy as many as 11 cargoes for January to April delivery, data compiled by Bloomberg show.

PTT Pcl canceled its tender for one February shipment last week and delayed its requirement to March without issuing a new tender, according to two traders with knowledge of the matter.

“Most February offers are from the Atlantic Basin, with reloads expected from Belgium and Spain in addition to Angola LNG’s first shipments of 2014,” according to WGI. “Buyers expect tenders to open shortly after the first cargo loads this week aboard Sonangol Benguela since the plant shut down for maintenance last October.”

Angola LNG will produce as many as three cargoes next month, with an estimated delivery to Northeast Asia between late-February and early March, the research company said.

Prices in North Asia are forecast to rise this week, according to three of six traders surveyed by Bloomberg News through Jan. 17. Asian LNG importers typically purchase spot cargoes from December to March to meet peak heating and power demand during the northern hemisphere winter.

Statoil ASA and Royal Dutch Shell Plc each sold a spot cargo this week at about $17.50 per million Btu to Argentina’s YPF SA for delivery to Bahia Blanca, said two people with direct knowledge of the matter.

To contact the reporter on this story: Chou Hui Hong in Singapore at chong43@bloomberg.net

To contact the editor responsible for this story: Pratish Narayanan at pnarayanan9@bloomberg.net

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