Analysts said that Asian spot liquefied natural gas (LNG) price might have already peaked for the winter demand season. The price had dropped to $6.40/mmBtu in the week ended November 20, 14.7% lower than this year’s high of $7.50 in the week ended October 30. However, LNG futures in New York roses $6.55/mmBtu on Monday after Qatar reportedly shut one of its liquefaction trains after a fault. This highlights that unexpected production outages can swing the spot price.
Tanker tracking data suggest that the Asian LNG market is well supplied, especially after the return of US cargoes. US LNG exports totalled 3.6 million tons in October and are expected to reach approximately 3.8 million tons this month. US LNG exports fell to 1.9 million tons in July when most Asian markets were under lockdowns. China resumed LNG purchases from the US, reaching 565,000 tons so far in November.
China’s LNG imports had totalled 7.1 million tons so far in November, on course to exceed 7.14 million tons imported in December 2019. LNG imports by Japan, the world’s biggest LNG importer, are expected to reach 6.73 million tons in November, jumping from 5.81 million tons last month. South Korea’s LNG imports are expected to be around 3.6 million tonnes, just under an eight-month high of 3.85 million tons recorded in October.
The shipping data suggests that most major buyers in Asia have already imported sufficient cargoes to meet their requirements. However, analysts warned that the ongoing oversupply might weaken spot prices substantially after the peak seasonal demand.
