Asian spot liquefied natural gas (LNG) softened for November delivery after several weeks of strong demand and tightening supplies led buyers to wait for a correction in prices.
Spot prices for November delivery in Asia were heard around $12.00 per million British thermal units (mmBtu) this week, down 5 cents from the week before, market sources said.
The first half of November was weaker than the second, with one cargo for delivery in the first two weeks of the month offered but unsold at $12.00, traders said.
The last of the October cargoes also weakened during the week, slipping to around $11.40 from $11.55.
LNG prices had risen in recent weeks to multi-year seasonal highs and above peaks reached in the previous four winters, usually the most expensive period of the super-cool gas.
Aside from demand from Japanese and South Korean customers seeking to replenish their gas stocks before winter, prices of contracts were pulled up by rising crude oil, against which some deals are priced.
Brent crude futures hit $80 a barrel briefly this week, the highest since May. Brent prices have not been consistently at the $80 mark since 2014.
In Bangladesh, one of the world’s latest LNG importers, supplies to its new floating LNG terminal are set to start on a regular basis following months of technical difficulties after a cargo from Qatar loaded last Sunday.
An official form the state-owned Petrobangla said cargos now should be arriving at a rate of around three a month, or every 10 days.
Nigeria Liquefied Natural Gas Company (NLNG) was selling a cargo for Sept. 26-28 FOB loading, with the tender closing on Sept. 13 Exxon Mobil’s Papua New Guinea LNG plant was also tendering a cargo, traders said.
India’s state-run GAIL (India) was in the market to sell a cargo from Cove Point, one trader said, adding it was the third time the utility was trying to sell LNG from the U.S. terminal with which it has a long-term tolling agreement.
Partners in Inpex Corp’s Ichthys project in Australia bought a second commissioning cargo, another trader said.
Despite low activity this week from Asian buyers, utilities are expected to be restocking sites after a hot summer which prompted more gas usage and delayed stocking up.
South Korea’s KOGAS, the world’s second corporate largest LNG buyer and only wholesaler in the country, bought 2.3 million tonnes of LNG last month — an increase of 18.8 percent from a year ago.
(Reporting by Sabina Zawadzki Editing by Edmund Blair)