Benchmark Asian spot LNG prices for October stood at $4.058/MMBtu on August 27, easing from a near seven-month high of $4.175/MMBtu on August 18. The prices hovered at record lows of between $2/MMBtu and $2.5/MMBtu for most of June and July due to low demand caused by the COVID-19 pandemic. US cargoes cancellations and production outages in Australia helped the prices to improve recently.
However, bullish sentiment has eased in the Asian gas market as end-users maintained a wait-and-see approach ahead of the winter peak season. Some analysts expect spot prices to soar toward $6/MMBtu during the winter purchases. But for now, the lack of firm buying interest in Asia casts uncertainty for the next few weeks.
At the same time, there is a concern about a second wave of coronavirus infections. Adding to the bullish sentiment are high European gas prices, US cargo cancellations, export constraints due to Hurricane Laura, and potential complete shutdown of Australia’s Gorgon LNG due to reports of cracks at its propane pressurization tanks.
