China, South Korea are top destinations for US LNG in July as Europe’s market share drops

China and South Korea were the top destinations for US LNG delivered in July, as flows of American volumes to Europe dropped to their lowest level since September 2021, an S&P Global Commodity Insights analysis showed Aug. 2.

Rising demand in the Pacific Basin, particularly in southeast Asia, contributed in July to the decline in US LNG cargoes shipped to Europe, which received less than half of the US volumes delivered for the third consecutive month. Europe, including Turkey, imported 34 from the US in July, or less than one-third of US LNG cargoes delivered throughout the month.

China and South Korea each received 11 US LNG cargoes in July, followed by Japan with nine, and India, the Netherlands and Argentina, each with eight, Commodity Insights data showed. The US cargoes arriving in Europe plus Turkey represented a decline from the 43 delivered in June, while Asia received 49 cargoes in July, up from 39 in June.

Shipments to India, which was one of the top destinations for US LNG delivered in June, came as hotter-than-expected temperatures continued to drive demand in the region.

The overall 117 US LNG cargoes delivered in July marked an increase from June, when 104 cargoes were delivered. The increase reflected the majority of cargoes headed for the Asian-Pacific opting for the longer route around the southern tip of Africa amid constraints at the Panama and Suez canals.

Loadings in July declined to 98 cargoes, down from 110 in June. That drop was due in part to the Freeport LNG export terminal shutting down July 7 ahead of Hurricane Beryl’s landfall on the Texas Gulf Coast. The storm knocked out power to Freeport and damaged part of the facility, keeping feedgas deliveries close to zero for over a week before the terminal ramped back up to close to full utilization by the end of the month.

But global LNG market fundamentals remained largely bearish headed into August, with healthy storage levels in Europe and muted buying interest in South Asia and China.

Atlantic LNG prices in have nonetheless rallied on global supply concerns over factors including maintenance in Norway, tensions in the Middle East and supply disruptions in Australia.

Platts, part of S&P Global Commodity Insights, assessed the September JKM benchmark price for LNG cargoes delivered to Northeast Asia at $12.915/MMBtu Aug. 2, up 0.5% on the day.

In Europe, the Platts DES Northwest Europe Marker for September was assessed at $11.60/MMBtu Aug. 2, up 12.5 cents on the day.

Across the Atlantic, Platts assessed the Gulf Coast Marker for US FOB cargoes loading 30-60 days forward at $10.82/MMBtu Aug. 2, up 12 cents from Aug. 1.
Source: Platts