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Asian spot LNG prices hit almost four-year high in Oct

  • Märkte: Natural gas
  • 19.10.26

The ANEA, the Argus assessment for spot LNG deliveries to northeast Asia, rose over the month to hit an almost four-year high on escalating tensions between the US and Iran.

The front-half month ANEA rose to $29.97/mn Btu on 19 October, up by $1.04/mn Btu from a day earlier and $2.38/mn Btu from a week earlier. The front-half month ANEA was last higher at $30.715/mn Btu on 21 December 2022 at the peak of the Russia-Ukraine war.

Asian spot LNG prices were likely mostly driven by strength in the TTF, Europe's benchmark gas hub. The Dutch TTF front-month price opened at €88.85/MWh ($99.73/MWh) on 19 October and remained largely rangebound around €88-89/MWh over the early Asian trading session. The contract price peaked briefly at €89.15/MWh at 1:50am GMT (09:50 Singapore time) and dipped to €88.175/MWh at 5:30am GMT (13:30 Singapore time).

Spot LNG prices have likely risen on the escalation of attacks in the strait of Hormuz over the past weeks. At least 12 vessels were attacked in the strait of Hormuz in the last week but many attacks are not being reported, according to the UK Maritime Trade Operations (UKMTO) Centre on 16 October.

The recent increase in attacks have come after the 159,800m³ Maran Gas Mystras was rumoured to be struck in the strait on 5 October. This has again fuelled concerns about Middle East LNG supply flows, raising concerns about LNG supply disruptions once again because LNG carriers are seemingly also at a higher risk of being attacked.

About 20 vessels managed to load and exit the strait of Hormuz in September, according to data from Kpler, which translates to about four to five cargoes weekly coming through from the Middle East. But this has since dropped to about seven vessels so far this month, according to data from Kpler as of 19 October, which translates to about two to three cargoes weekly from the Middle East.

Market participants are increasingly worried about transits through the strait of Hormuz and the sufficiency of LNG supplies over the upcoming peak winter season.

Northeast Asia's demand has been relatively muted on expectations of a warmer-than-usual winter because of the effects of El Niño, but market participants remain concerned about the relatively higher demand from the Atlantic basin.

Europe's inventories currently stands at 74.47pc on 18 October, AGSI data show. The pace of injections has slowed, rising by only 0.79 percentage points from 73.68pc on 11 October. This compares with a 1.27 percentage point increase on 11 October from 72.41pc on 4 October, and a 1.52 percentage point rise on 4 October from 70.89pc on 27 September. The slower pace of injections could possibly be attributed to higher demand for gas as colder weather across the continent kicked in, traders said. But this has also sparked concerns that the region may need to seek more spot cargoes in the upcoming weeks, potentially intensifying inter-basin competition for cargoes if winter demand across northeast Asia also materialises.


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