Cheaper LNG prices tempt Asian buyers
The LNG price has skyrocketed 1,900 per cent from its tariff two years ago. PHOTO: FILE
Cheaper spot prices for liquefied natural gas (LNG) are luring price-sensitive buyers back in Asia, with China and India recording rising imports in March.
The spot price of LNG for delivery to north Asia was $12.50 per million British thermal units (mmBtu) in the week to April 6, steady from the previous week, which was the lowest level since June 2021.
China lost its status as the world’s biggest importer of LNG back to Japan last year, largely because its utilities pulled back from the spot market as prices surged.
India was another LNG importer stung by the record high spot prices last year, but is returning to the market as prices retreat.
Other smaller Asian LNG importers, such as Pakistan, Bangladesh and Thailand also recorded higher arrivals in March from February. What’s worth noting is that Asia’s overall imports of LNG were largely steady in March, coming in at 22.35 million tonnes, up slightly from February’s 22.18 million tonnes, but down on a per-day basis.
This is largely because developed country importers such as Japan typically see lower imports as the peak winter demand season ends, with March arrivals pegged at 5.58 million tonnes, down from 6.54 million in February.
South Korea, Asia’s third-largest LNG buyer, saw March imports of 4.41 million tonnes, down from February’s 5.13 million.
At the same time, Europe’s LNG imports appear to be heading higher, implying that utilities are also taking advantage of lower spot prices to maintain high natural gas inventories, which are vital to stave off the threat of a complete end to already vastly curtailed flows of Russian pipeline supplies.
Europe’s March LNG imports were 11.49 million tonnes, up from February’s 11.37 million.
Published in The Express Tribune, April 13th, 2023.
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