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Economic Times
02-05-2025
- Business
- Economic Times
LNG traders divert four US cargoes from Europe to Asia
Live Events (You can now subscribe to our (You can now subscribe to our Economic Times WhatsApp channel Four cargoes of liquefied natural gas headed for Europe changed course to Asia in the last two weeks, after European prices fell below the Asian benchmark and opened up an arbitrage for deliveries eastward, according to analysts and shipping cargoes diverting from the Atlantic to the Pacific would increase competition between the two basins, in a year when Europe may need up to an extra 250 LNG cargoes to refill its depleted gas stores ahead of winter.A combination of improved netbacks to Asia and easing European price support, rather than stronger Asian demand, had led to a clear, if narrow, economic case for redirection, said Go Katayama, principal insight analyst at data analytics firm Kpler."JKM premiums over TTF have widened, improving netbacks for U.S.-origin cargoes," he said."This has reopened the arbitrage channel, particularly for June to July delivery windows."The Japan-Korea-Marker (JKM) is the LNG benchmark price assessment for spot physical cargoes in Asia. The Dutch Title Transfer Facility (TTF) is the benchmark for natural gas in data showed the Energy Innovator tanker, controlled by Germany's RWE, departed Freeport LNG in Texas on April 7. It was destined for Dunkirk, France before diverting towards the Cape of Good Hope on April Shell-controlled New Nature tanker also changed course from Europe to head south on April 24, after departing Sabine Pass LNG in Louisiana on April more tankers have also seen later arrival dates, suggesting a switch in destinations from Europe to Asia which adds a couple of weeks' travel time, said Alex Froley, senior LNG analyst at data intelligence firm arrival date for the Orion Spirit tanker changed from April 24 to May 14, while the Pacific Success tanker's arrival date changed from April 22 to May 18, he said."The estimated time of arrival on those suggests they switched from a two-week journey across the Atlantic to a longer journey to Asia."Kpler data shows the Orion Spirit and Pacific Success, both controlled by TotalEnergies, were initially bound for Dunkirk, France and Rostock, Germany despite its proximity to Europe, the first loading from the Greater Tortue Ahmeyim project offshore Mauritania and Senegal on the British Sponsor tanker is heading towards Asia, added data shows BP's British Sponsor is on course for Singapore."However, Europe should still continue to receive large amounts of LNG, and if storage injection rates start to slow, Europe would likely increase its prices a little to pull more cargoes back," said Froley, adding that Asian demand is not picking up strongly."The change is more about the speed at which both markets have drifted lower in recent weeks on weaker economic expectations."Asian spot LNG prices had been holding at near one-year lows since mid-April as demand remained tepid. They were last at $11.80 per million British thermal units (mmBtu) on April benchmark front-month contract at the Dutch TTF hub closed at 32.10 euros per megawatt hour on Thursday, or $10.62/mmBtu. It had closed at $10.64/mmBtu on April 25.
Zawya
10-02-2025
- Business
- Zawya
Oman, Australia LNG vessels head west, one via Red Sea, as Europe draws supply
At least three vessels carrying liquefied natural gas (LNG) from Oman and Australia are heading west for delivery, with one sailing through the Red Sea, shiptracking data showed on Monday, as higher prices in Europe continue to draw more supplies. Increasing shipments of the super-chilled fuel to Europe over Asia could help it meet additional demand, as it seeks to replace piped Russian gas after the Ukraine transit deal expired on January 1. At least six LNG cargoes diverted from Asia to Europe last month. Two tankers loaded at Qalhat, Oman, earlier this month and are heading west, in the first such shipments since July 2023, data from analytics firms Kpler and LSEG showed. Tanker Greenergy Pearl, loaded between February 1 and 3, is heading for the Fos Cavaou LNG terminal in France, while the Salalah LNG vessel, which loaded between February 4 and 5, is headed for the Marmara Erglisi LNG terminal in Turkey, LSEG data showed. The vessel had sailed through the Gulf of Aden off the coast of Yemen on February 7, and is now making its way through the Red Sea. "Flexible volumes from Oman and Qatar could continue to be destined to Europe in a high TTF environment in the prompt market," said Kpler analyst Go Katayama, referring to the Dutch Title Transfer Facility benchmark for Europe. He added however that the number of vessels using the Bab al-Mandab strait in the Red Sea may still be limited as geopolitical risks could arise again. Many shipping companies had previously suspended Red Sea voyages, instead rerouting vessels around Africa to avoid potential Houthi attacks. Of the 12 million metric tons of LNG exported from Oman last year, nearly all shipments went to Asia, with only two or three cargoes going to Kuwait, data showed. The Iran-aligned Houthis, who have carried out more than 100 attacks on ships since November 2023 and sunk two vessels, said they would limit their attacks on commercial vessels to Israel-linked ships provided the Gaza ceasefire is fully implemented. Additionally, an LNG vessel that departed Wheatstone, Australia, on February 5-6 is making a rare voyage to Europe, and is set to arrive at Dunkirk in France on March 7-8, the data showed. The Elisa Ardea is a new ship put on long-term charter for French utility EDF, said Alex Froley, senior LNG analyst at ICIS. If the Elisa Ardea completes the voyage to France, this would be the first Australian cargo to Europe since the Woodside Rees Withers took one from Northwest Shelf to Gate in Rotterdam in November 2022, he added. However, he does not expect more Australian LNG to head to Europe as the ship is probably being repositioned from the Pacific to the Atlantic for U.S. shipments to Europe. (Reporting by Emily Chow; Editing by Florence Tan and Hugh Lawson)
Zawya
31-01-2025
- Business
- Zawya
Europe Gas: Prices at fresh 15-month high amid cold weather, restocking concerns
Dutch and British wholesale gas prices rose to a fresh 15-month on Friday morning as cold weather forecasts boosted demand and on concerns over storage refilling amid tightness in the market. The benchmark front-month contract at the Dutch TTF hub was up down 0.78 euro at 51.60 euros per megawatt hour (MWh), or $15.80/mmBtu, by 0948 GMT, its highest level since mid October 2023, according to LSEG data. The Dutch March contract was up 0.50 euro at 52.22 euros/MWh. In Britain, the front-month contract rose by 2.25 pence to 132.00 p/therm. Demand for gas for heating is up 766 gigawatt hours per day (GWh/d) for the day-ahead, 73 GWh/d for the weekend and 43 GWh/for working days next week, due to an average temperature drop of around 3 degrees Celsius, LSEG data showed. "Concerns about rapidly declining gas storage levels has seen countries working to ensure refills, with Germany proposing subsidies and Italy preparing an early start to seasonal storage," said Daniel Hynes, senior commodity strategist at ANZ bank. EU members are required to have storage levels at 90% full by November, However, this year they will face stiff competition from other consumers amid tightness in the global LNG market, he added. EU gas storage levels were 54.65% full on Friday, data from Gas Infrastructure Europe showed. "There could be some softening from current high prices if February brings milder weather. However the market is set to plateau at quite a strong level across most of the spring and summer as Europe continues competing with Asia for flexible LNG to refill its storage," said Alex Froley, LNG analyst at data intelligence firm ICIS. Hungarian Prime Minister Viktor Orban threatened on Friday to block the next rollover of EU sanctions against Russia unless Brussels helps achieve a restart of Russian gas transit via Ukraine, which was halted on Jan. 1. In the European carbon market, the benchmark contract was down 0.60 euro at 82.35 euros a metric ton. (Reporting By Marwa Rashad; Editing by Nina Chestney)
