Global LNG Monthly: Winter peak supply crunch fears spread

With north Asia Europe entering the peak of winter, Bloomberg New Energy Finance expects December imports of liquefied natural gas (LNG) to rise November levels. China's natural gas demand in December will hit its highest level so far this year, supporting strong LNG imports. A combination of heating demand, coal shortages lower-than-expected nuclear power generation pushed imports to Japan South Korea. LNG supplies are set to rise in December as Qatar returns to full capacity the US ramps up exports. However, production problems at factories in Southeast Asia will affect supply growth. Asia, which is suffering supply disruptions, soaring freight rates competition gas-hungry Europe, is likely to see continued upward pressure on spot LNG prices in December.

Global imports of liquefied natural gas (LNG) are expected to reach 35.2 million tons in December, up 12 percent November. Imports North Asia are expected to rise to meet higher heating demand. Coal supply problems delays in restarting nuclear plants will boost Japan's imports. The increase in LNG demand in December will depend on temperatures in Asia, as La Nina can lead to colder than usual weather. South Asian LNG imports may be lower than previously expected due to the closure of an LNG terminal in Bangladesh a drop in Imports India.

We have cut our forecast for gas inventory levels in Europe at the end of winter by more than half previous monthly forecasts. While European gas demand remained solid, competition with Asia led to lower-than-expected LNG imports, Russian gas imports remained low in November. We have revised up LNG demand in Turkey in light of higher gas electricity demand.

Global LNG supply is expected to reach 34.4 million tons in December, up 3.6 percent November. In addition to Malaysia's supply problems, Indonesia Brunei also face production problems. Supply is expected to be affected throughout the winter. However, overall LNG supply will rise in December as Qatar returns to full capacity after plant maintenance, while net recovery seasonal factors are expected to boost US Australian exports.

Bloomberg New Energy Finance forecasts that the JKM Benchmark price for delivery in the first quarter of 2022 will average $35 per million British thermal units. So far, first-quarter deliveries in Asia have averaged $37.50 per million British thermal units, Bloomberg news reported in November.

Global LNG imports totaled 31.5 million tons in November, up 2.7 percent October up 6 percent a year earlier. China Japan led the month-on-month increase in imports due to rising heating demand, while South Korea's LNG imports fell as it developed gas. LNG shipments to Europe rose, buoyed by strong demand the UK Turkey, but still failed to offer a more attractive net return than in Asia.

Overall LNG exports reached 33.2 million tons in November, 0.5 percent higher than October 5.4 percent higher than a year earlier. Qatar's exports fell on factory maintenance, but were more than offset by flat Australian exports higher supplies the US Russia. The month-on-month increase in LNG exports came despite reported upstream gas supply problems in Indonesia, Brunei Malaysia.

JKM prices remained volatile in November, following changes in Dutch TTF prices reflecting higher LNG seaborne rates. Supply disruptions in the Pacific Basin expectations of cold weather brought Asian buyers back into the spot market, pushing prices higher. Time charter costs for LNG carriers have skyrocketed due to the demand for ships in winter.

Chinese buyers continue to actively sign regular agreements with suppliers dominated by U.S. companies.

A set of data

35.2 million tons of

Expected LNG imports in December 2021

3.6%

Global LNG supply increased in December November's forecast

$35 per million British thermal units

Bloomberg New Energy Finance forecasts for the Japan-Korea benchmark average price (JKM) in the first quarter of 2022

For more information about energy trading platform, please consult Eurasia International Energy Trading Market Management (Jiangsu) Co., LTD., the manufacturer of financial service platform, storage logistics platform, dangerous chemical business license application platform bulk energy trading platform.

Source: Bloomberg New Energy Finance

Disclaimer: This article is Bloomberg New Energy Finance. The dissemination is for reference only does imply that the company endorses its views is responsible for their authenticity, nor does it constitute any other recommendation. If you find any works infringing your intellectual property rights on the official account, please contact us we will modify delete them in time