LNG Bunker Snapshot: Singapore’s LNG price flips to premium over Rotterdam

Rotterdam's LNG bunker price has slumped with TTF and shrinking bunker premiums, while Singapore's price has dipped with amid demand in the broader Asian LNG market.

Changes in weekly LNG bunker prices:

• Rotterdam down by $77/mt to $781/mt
• Singapore down by $5/mt to $828/mt

Rotterdam

Rotterdam’s LNG bunker price has dropped sharply for a fourth consecutive week, reaching $781/mt. Its weekly decline has primarily been driven by a reduction in the estimated LNG bunker premium, which is down from approximately $155/mt to $113/mt.

A 5% drop in the front-month Dutch TTF Natural Gas contract, a key European gas benchmark, has contributed heavily to the decrease.

The TTF decline is a result of “warm weather, stable supplies from the Norwegian continental shelf, and the possibility of gas supplies via Ukraine resuming," according to the Japan Organization for Metals and Energy Security (JOGMEC).

“The market is under pressure due to mild weather and fears that a US-EU trade war could cause the European economy to weaken, which could cause limited gas demand,” Energi Danmark noted.

Singapore

Singapore's LNG bunker price has declined by a modest $7/mt over the past week, reflecting “sluggish demand in Northeast Asia,” according to JOGMEC. Singapore's $25/mt discount to Rotterdam has been reversed within a week, turning into a $47/mt premium.

LNG inventories for power generation grew to 1.97 million mt on 2 March, marking a slight increase of 40,000 mt from the previous week, according to Japan's Ministry of Economy, Trade and Industry (METI).

Asian LNG bunker prices typically follow the NYMEX Japan/Korea Marker (JKM), which has edged $0.09/MMBtu lower over the same period, bringing the front-month contract to $13.76/MMBtu ($716/mt).

Looking ahead, “purchasing demand from Southeast and South Asia is expected in preparation for the summer season” in the coming weeks, JOGMEC noted.

By Tuhin Roy

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