Home / Commodities / Freight News / US LNG WEEKLY: Europe appetite helps lift Gulf Coast FOB cargo values to new nigh

US LNG WEEKLY: Europe appetite helps lift Gulf Coast FOB cargo values to new nigh

Strong buying in end-user markets and lower shipping costs helped lift US Gulf Coast FOB export cargo values to the highest level on record to finish the week of Dec. 7-14.

Feedgas deliveries to the six major liquefaction facilities in operation tracked the heavy global demand for LNG, especially in Europe. In the coming weeks, a seventh US LNG export terminal, Venture Global LNG’s Calcasieu Pass in Louisiana, was expected to start up.

The trends in fundamentals were expected to continue in the near-term, as winter temperatures drop in destination markets and boost demand for the super-chilled power plant and home heating fuel. That could be an even more bullish sign for FOB cargoes.

“With the shrinking spreads, there will be a big flow towards Europe,” an Atlantic-based trader said.

The S&P Global Platts-assessed Gulf Coast Marker ended the week at $38.80/MMBtu on Dec. 14, surpassing the previous record high of $37.00/MMBtu on Oct. 5. The Dec. 14 price was up $3.40/MMBtu from the day before and $10.40/MMBtu from the beginning of the week.

Total US feedgas demand rose to a high for the week of 12.4 Bcf/d on Dec. 12, ranging between there and the low of 11.2 Bcf/d on Dec. 7, Platts Analytics data showed. Cheniere Energy’s Sabine Pass Train 6 in Louisiana achieved its first cargo on Dec. 7. Small feedgas deliveries were registered daily during the week at Calcasieu Pass, as commissioning ahead of startup continued.

According to Venture Global, the Louisiana terminal was about 91% complete as of the end of October. All 18 liquefaction modules have been received from Italy and set on foundations.

The higher netbacks to the Gulf Coast during the week were helped by lower freight costs. Panama Canal congestion remained relatively low, with the maximum wait on Dec. 14 for unreserved LNG tankers at six days northbound towards the Gulf and three days southbound towards the Pacific, according to the Panama Canal Authority.

A Europe-based trader heard US Gulf Coat to East Asia shipping at around $6/MMBtu for second half of January. The trader heard USGC to Northwest Europe shipping at around $3/MMBtu for second half of January loading.
Source: Platts

Recent Videos

Hellenic Shipping News Worldwide Online Daily Newspaper on Hellenic and International Shipping