Asian Prices Drop On Wary Buyers And Lackluster Egyptian Demand
LONDON, Oct 20 (Reuters) - Asian spot LNG prices fell this week as reluctant buyers submitted lower bids, more supply emerged and Egypt's call for 12 shipments in Q1 2018 undershot expectations by traders.
Spot prices
Bid-offer spreads remained somewhat wide with bids submitted at around the mid-$5/mmBtu and offers in the high-$5/mmBtu range, two traders said.
Egypt's tender for deliveries between January and March - including three shipments which are to be imported via Jordan - was seen as a bearish signal for global gas markets as traders had expected Egypt to seek five cargoes per month, not four.
Petroleum Minister Terek El Molla said in September the country was on track to cease importing LNG by the end of 2018, a goal seen as unrealistic by some analysts.
Egypt's mega purchase tenders of the past several years turned the country into one of the world's fastest-growing LNG importers, absorbing hundreds of shipments and propping up global prices for the fuel.
Weaker spot Asian prices come after weeks of gains which saw the contract rally more than 40 percent since the end of August.
"The market has really overshot, driven by a variety of factors from the extent of Chinese demand, which was completely unexpected, to rising NBP [British gas] prices and other factors such as Hurricane Harvey," one trade source said.
Another source said added that prices are set for a further correction. "There is downside risk for December prices and upside risk for the first quarter."
Given rapidly growing imports by Chinese companies this year, traders believe stocks there to be healthy and demand covered for November and December so long as temperatures stay within normal bounds.
But Chinese and other buyers are expected to seek more supply for delivery from January onwards. Weather will be a driving factor for demand and traders are waiting for a clearer sense of temperature forecasts for the period.
Russia's Sakhalin II LNG export plant on Friday launched a tender offering a late-December loading cargo, traders said.
Nigeria's NLNG export plant put a Nov. 5-7 loading cargo up for tender, with bids due by Oct. 24.
The first cargo from Chevron's latest LNG export facility Wheatstone, in Australia, is due to be shipped using the Asia Venture tankers which is currently moored just outside the facility, according to ship-tracking data.
12
View Full Article
WHAT DO YOU THINK?
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
- Weatherford CEO's Rebound Plan Relies On Getting Smaller
- Iran Says Oil Market Is Too Tight For US Zero Exports Target
- China's Squeezed 'Teapots' Eye Petchem Path To Riches
- Baker Hughes: US Drillers Add Oil Rigs For Second Week In Three
- Venezuela Hands China More Oil Presence, But No Mention Of New Funds
- ExxonMobil Racks Up Discoveries in Guyana Block Eyed by Chevron
- Oil Market Sentiment Has Improved Significantly
- EU, US Eye Collaboration on Nuclear Materials
- USA Driving Activity to Increase to All-Time Highs
- TC Energy to Sell Prince Rupert Gas Pipeline Project to First Nation
- EU Electricity Export to Ukraine Up 94 Percent in Two Years
- China Coal Output Falls for First Time since Government Ordered More
- BP Pulse Buys One of Europe's Largest Truck Stops
- UK CCUS Plans Outdated: Think Tank
- North America Enters Rig Loss Streak
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- EIA Drops 2024 Henry Hub Gas Price Forecast
- EIA and Standard Chartered Offer Up Latest Oil Price Predictions
- Red Sea Region Sees Another Watershed Incident
- Chevron Oil Project in Kazakhstan to Cost $48.5B
- OPEC Voices Encouragement after IEA Affirms Support for Oil Security
- Biden Govt Bares Strategy for Freight Charging, Hydrogen Fueling Infra
- Ukraine Hits Third Russian Refinery In Escalating Drone Strikes
- Rystad Looks at the Buzz Around White Hydrogen
- VIDEO: Missile Attack Kills Crew Transiting Gulf of Aden
- Norway Regulator Blasts Proposal to Halt New Oil and Gas Permits
- Chinese Mega Company Makes Major Oilfield Discovery
- What Is the Biggest Risk to Offshore Oil and Gas Personnel in 2024?
- Is Peak Oil Demand Close?
- Vessel Sinks in Red Sea After Missile Strike
- JP Morgan, Standard Chartered Reveal Latest Oil Price Forecasts
- Exxon Rights in Stabroek Do Not Apply to Hess Merger with Chevron: Hess
- Rystad Forecasts Net Production of Top Permian Producers in 2024
- Analysts Reveal Latest Oil Price Outlook Following OPEC+ Cut Extension