Last week, prices of liquefied natural gas (LNG) slipped on the back of muted demand from China.
The average LNG price for January delivery into Northeast Asia fell by USD1.50 to USD34.60/mmBtu.
According to several trade sources, Chinese LNG buyers are leaving the spot purchasing as inventories are ample on the persistently high prices. Another source added that the Chinese government has a higher tolerance for additional coal burning, which dampened the appetite for more-expensive LNG.
However, the drop in prices was kept in check by outages in Australia which curbed cargo loadings. Royal Dutch Shell shut production at its Prelude floating LNG site and Chevron Corp shut one of three processing units at its Gorgon LNG plant. Both facilities are located in northwestern Australia and have not released a timeframe for restoring output.
