Customers have cancelled more than 40 LNG cargoes for August loading at US export terminals, according to trading sources. This follows cancellations of more than 45 shipments for July loading. More than half of the cancelled cargoes are reportedly tied to Cheniere's two terminals in the US Gulf Coast, the sources added.
According to the sources, France's Total, Japan's JERA, and Spain's Naturgy were among buyers who cancelled August shipments. The coronavirus pandemic has forced off-takers to cancel about 130 US LNG cargoes since April.
The cancellations mean US liquefaction terminals would take less gas. This week, gas intake by US liquefaction plants fell to its lowest since October last year. Declining feedgas flows can create a domino effect that will likely impact US midstream operators and shale gas drillers. Some traders also expected that prices would face further pressure.
Benchmark spot LNG prices for North Asia were last observed at $2.15/MMBtu, slightly above the record lows recorded by the end of April. In Europe, benchmark spot prices for the Mediterranean settled at $2.055/MMBtu on Monday. Meanwhile, prices in the USGC increased to $1.575/MMBtu on Monday from $1.125/MMBtu a month earlier.
