Atlantic LNG MOC sees record volume of 57 bids/offers in March
S&P Global Platts Atlantic LNG MOC saw a total of 57 bids/offers in March, making it the highest monthly volume ever, surpassing the last record in July 2019, when 45 were reported by market participants.
The Atlantic LNG MOC is the price assessment process for Platts Northwest Europe, Mediterranean and Gulf Coast Markers.
Of the March 2021 volume, 45 were for Northwest Europe, or Northwest Europe with flex to North Spain, with the rest of the volume destined to the Mediterranean. US FOB activity was not reported, as lower freight rates and open arbitrage to Europe translated to more companies offering DES Europe.
Atlantic traders were incentivized to sell volume into Europe coming into March as global gas and LNG spreads closed, alongside low gas stocks creating more demand into the UK and continental Europe.
According to Platts data, the DES Northwest Europe stood at $6.301/MMBtu on March 31, up $1.064/MMBtu when compared to Feb. 26.
Some portfolio optimization was also likely to have risen on the back of the blockage of the Suez Canal, which could have created some short positions in need of filling. Sellers of US volume would have been incentivized to offer into Europe as opposed to Asia in order to avoid sending volume via the Cape of Africa or risking delays through the Panama Canal, both of which would add time and costs to a journey.
On top of this, a bearish shipping market allowed for increased activity as traders look to capitalize on cheaper DES costs. According to Platts data, the average Atlantic day rate stood at just over $30,000/day for March, down from an average of $70,800/day in February.
A total of 70 cargoes were shown in the MOC for Q1, making it the greatest quarterly volume since the first Atlantic MOC order was reported to Platts in June 2019.