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GLOBAL LNG-Asian prices fall to near two-month low as demand slows

Asian spot prices of liquefied natural gas (LNG) fell for a second straight week to their lowest in nearly two months amid warmer weather forecasts and higher supplies.

The average LNG price for March delivery into Northeast Asia LNG-AS was estimated at about $8.40 per million British thermal units (mmBtu), down 50 cents from the previous week, sources said. This is the lowest that spot prices have hit since early-December, Reuters data showed.

On Thursday, oil major BP (LON:BP) bought a cargo for delivery into Northeast Asia over March 16 to March 18 from Diamond Gas International, a subsidiary of Mitsubishi Corp, at $8.40 per mmBtu, data from price agency S&P Global (NYSE:SPGI) Platts showed.

This follows cargo sales from Woodside Energy and Chevron (NYSE:CVX) from LNG tankers for delivery in February, highlighting the availability of supply that has become available, traders said.

“Production (from Australia) was unstable. So, some of the suppliers had kept buffer cargoes on tankers as insurance, but production turned out ok, so they didn’t need the buffer cargoes,” a Singapore-based trader said.

Offers were also seen from Russia’s Sakhalin Energy, Papua New Guinea LNG plant and Oman LNG, they said. tanker rates also dropped, which also weighed on cargo prices, traders said.

The lower spot prices attracted some pent-up buying demand from South Asian customers who had stayed away when prices surged to a record $32.50 per mmBtu earlier this month.

Indian Oil (NS:IOC) Corp bought a cargo for delivery on March 10 into Dahej from Vitol at close to $8 per mmBtu after earlier buying a cargo for delivery over Feb. 20 to March 5 from Ras Laffan Liquefied Natural Gas Company at $8.70 per mmBtu, traders said. Gujarat State Petroleum Corp (GSPC) also bought a cargo for mid-February delivery at about $8 to $8.40 per mmBtu from Qatar Petroleum Trading, a source said.

Pakistan LNG bought three cargoes for delivery in March through an emergency tender it issued last week, sources added.
Source: Reuters

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