LNG Bunker Snapshot: Rotterdam's price rises as supply tightens

Rotterdam’s LNG bunker price has risen in the past week due to supply disruptions and higher demand driven by a heatwave in southern Europe, while Singapore's price has come down amid ample supply.

PHOTO: LNG tanker. Getty Image

Changes in weekly LNG bunker prices:

• Rotterdam up by $22/mt to $652/mt
• Singapore down by $11/mt to $760/mt 

Rotterdam

Rotterdam’s LNG bunker price has risen by $22/mt to $652/mt in the past week. The price rise has mirrored the increase in the front-month NYMEX Dutch TTF Natural Gas contract.

The upward trend can be attributed to supply concerns at Freeport LNG, a major source of European LNG supply. Freeport LNG accounted for 5.4% of Europe’s total LNG imports in 2023. Supply disruptions, caused by Hurricane Beryl, led to cancellation of several LNG cargoes from the US-based export facility. This has contributed to push Rotterdam's LNG price higher in the past week.

At least 10 cargoes were reportedly cancelled last week due to the outage at the LNG export plant, head of commodities strategy at ING Warren Patterson said.

The ongoing heatwave in southern Europe have also contributed to the price rise. Many Italian cities have issued emergency heat alerts as temperatures climb above 40°C, with this the heatwave is expected to last until early August, according to Rystad Energy.

These supply disruptions, combined with warmer weather across Europe, have contributed to the LNG price rise in the past week.

Singapore

In Singapore, the LNG bunker price has decreased by $11/mt, driven by a lower NYMEX Japan/Korea Marker (JKM) price.

The JKM price increased some in the middle of last week due to active deals to meet summer demand. However, the price then fell due to ample supply and high inventory levels, according to a report by the Japan Organization for Metals and Energy Security (JOGMEC).

In Japan, high storage levels have partly offset the impact of increased LNG demand caused by regional heatwaves. This has reduced competition for spot LNG cargoes and alleviated some of the upward price pressures resulting from the Freeport LNG facility’s closure.

South Korea’s Hanbit nuclear unit began planned maintenance on 11 July and is expected to resume operations around early October. However, this maintenance work has not yet led to increased buying of LNG from South Korean companies, as they currently hold high inventories, as per Rystad Energy.

Similarly, there has been minimal spot buying from China, contributing to the price decrease in Singapore.

By Debarati Bhattacharjee

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